It’s been six months since I joined the company now known to many as VettaFi as head of research. Back then, we went by many names, including ETF Trends, ETF Database, Alerian, S Global Networks, or the place where many ETF nerds from TV work together. Six months is a nice milestone to use to reflect on how things are going. In short, VettaFi is on the path to transforming financial services from an industry into a community -- one relationship at a time -- while providing tremendous value.
At VettaFi, we’ve tried to connect our proprietary data insights gleaned from advisors with our data on ETFs. For example, advisors recently told us during a webcast that given market conditions, they were focusing more of their attention on emerging market equities over developed international equities. So we provided research showing that the two most popular emerging market ETFs -- the Vanguard FTSE Emerging Markets ETF (VWO) and the iShares Core MSCI Emerging Markets ETF (IEMG) -- did not agree on what was an emerging market. For example, South Korean stocks like Samsung were a major weighing in IEMG but not VWO. Making the decision between the two popular emerging markets ETFs is not as straightforward as many would like.
Another example of VettaFi’s efforts to blend ETF data and research was in June when we asked advisors “How have your views on the investment benefits of disruptive innovation shifted in the past year?” For perspective, the most prominent of the disruptive innovation ETFs -- the ARK Innovation ETF (ARKK) -- was down approximately 60% for the year at the time of the article. Yet ARKK gathered $1.4 billion in the first half of 2022.
Interestingly, 39% of advisors were more bullish than before while just 16% of respondents were more skeptical than before; the remaining 45% of those that were polled had not changed their views. In our research piece, we highlighted that there were other disruptive-technology-focused ETFs and that their different construction styles created an opportunity for advisors to potentially tax loss harvest. They could sell ARKK and perhaps buy the ARK Genomic Revolution ETF (ARKG), the BlackRock Future Innovators ETF (BFTR), and the Goldman Sachs Future Tech Leaders Equity ETF (GTEK).
Meanwhile, my colleagues Karrie Gordon and Dave Nadig have published multiple compelling research pieces, in particular focused on what has increasingly been a hot topic: ESG. One such piece attempted to measure ESG’s unmeasurables by noting that the jury is still out on measuring social factors -- the S pillar of ESG -- and that inclusion is difficult to define, much less quantify and measure. So while the iShares ESG Aware MSCI USA ETF (ESGU) has pulled in $1.5 billion thus far in 2022, there are challenges in answering whether ESG works or doesn’t in its objective.
In addition, on this site we’ve covered many of the other compelling topics of 2022, including the aggressive Fed and the impact on fixed income investing, shifting interest in commodities, demand for energy infrastructure, volatility in crypto investments, and growing interest in high dividend ETFs. We hope advisors continue to leverage VettaFi’s ETF data and research to support end clients into 2023 and beyond. But before we get to 2023, don’t forget to vote in the ETF Express awards.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.