Credit: Shutterstock photoCinthia Murphy, Managing Editor, ETF.com
It’s been two months since Vanguard entered the actively managed ETF space with the launch of six active factor funds. Assets, however, have yet to follow.
The second-largest U.S. ETF issuer, with more than $882 billion in U.S.-listed ETF assets, knows a thing or two about bringing successful strategies to market. But adoption of its active ETFs has thus far been slow at best.
Two months since inception, four of the six active factor funds have seen zero net asset inflows. Only one ETF—the Vanguard U.S. Multifactor ETF (VFMF)—has seen a decent $11 million in net creations since mid-February.
There are several reasons for the slow uptake, from the need to educate advisors about factor investing and implementation, to the lack of a live track record of active managers, to the market environment and investor behavior.
“There's little evidence so far that any investor has figured out how to time the market with factors,” Elisabeth Kashner of FactSet said. “It's not surprising that the only fund with real pickup is the multifactor fund.”
There’s no question that factor investing is popular, and in the ETF space, it’s gathering steam as more issuers bring factor-based solutions to market. But even in this popular space, finding traction can take time.
Bitcoin Vs Gold
In other news this week, ETF.com looked closely at whether bitcoin could actually challenge gold “as a form of currency, a store of value and sometimes a speculative or alternative asset to stocks and bonds.”
Some say bitcoin demand has been growing at the expense of gold’s demand among many investors who’ve been switching allocation of one for the other. Others say this is all speculation and there’s no data to back up this type of assessment.
Broadly speaking, to quote Will Rhind, founder and chief executive officer of GraniteShares, the bitcoin-gold race isn’t a “zero-sum game.” There’s room and demand for both.
The good news for gold bugs concerned about bitcoin’s popularity could find support going forward if equity markets stage a correction and commodity markets globally continue to benefit from a pickup in aggregate demand, as many predict.
More on ETF.com
Surprise Exposures & Why Your NAV Is Wrong
What To Do About MLPs After Turmoil
WisdomTree Plans Factor Approach
ETF Week: 4 Funds Launch; Issuer Regroups
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
