ETF Research & Insights

China Fails to Pass ESG Test

Market News - May 3, 2017

Emerging-markets ESG filters help investors to align their asset allocation with their values, but they also create large unintended country bets. The UBS MSCI Emerging Markets SRI ETF (UC79) and the iShares MSCI Emerging Markets SRI ETF (SUSM) provide exposure to emerging-markets firms that have a limited negative impact on the environment; promote diversity and have good relationships with key stakeholders, including employees; and strong corporate governance systems. They also exclude companies in...

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ETF Sales Triple to Record High

Market News - April 20, 2017

The European exchange-traded fund market has got off to a stellar star in 2017, with record-high net inflows of €33.4 billion in the first quarter, tripling the €11.1 billion registered in the closing three months of 2016. Assets under management at the end of the first quarter amounted to €601 billion, and were up 10.2% from €545.7 billion at the end of 2016. US and European Equities Prove Popular...

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Gold Bounces Despite Fed Rate Rise

Market News - March 17, 2017

The gold price rose 2.3% to $1,230 yesterday after the Federal Reserve raised interest rates in the US amid signs that inflation is moving higher. The gold price reaction was a surprise; in general when interest rates rise, the price of the precious metal will fall. This is because rising rates are a sign of a healthy economy, and gold is used as a hedge against recession and uncertainty. But today gold price...

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Investors Pour $63bn into ETFs

Market News - March 3, 2017

Investors poured cash into passive funds at the beginning of the year, with global exchange-traded funds seeing inflows s twice the average inflows of the past nine years, data from Morningstar Direct revealed. The nine-year average for monthly flows into ETFs globally is $22 billion, while in January worldwide ETFs recorded inflows of $63 billion. This was the highest monthly figure since September 2015, when ETFs saw global inflows of $73 billion. The...

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What is a Minimum Volatility ETF?

Market News - February 7, 2017

The popularity of strategic-beta ETFs has risen sharply over the past few years. One of the fastest growing segments are those exchange traded funds which aim to reduce risk within an equity portfolio; called low-volatility and min-volatility funds. From the launch of the first minimum volatility ETF by Amundi in 2009, the total number of products has mushroomed to almost 70 globally, according to Morningstar’s classification, amassing nearly $45 billion of...

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Gold ETF Inflows Spike Ahead of the US Election

Market News - November 15, 2016

Magpie investors continue to crave gold bullion as a hedge against the global political uncertainty, data from Morningstar shows. The precious metals ETF sector recorded €818 million inflows in October alone, the biggest inflows across all sectors, according to Morningstar Direct. ETFS Physical Gold (PHGP) was one of the five most clicked exchange-traded funds among Morningstar.co.uk readers in October ahead of the US Presidential Election. Investors also were researching ETFs that track...

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Passive Fund Fees Fall as Smart Beta ETF Market Grows

Market News - September 12, 2016

Strategic beta, widely referred to as “smart beta,” refers broadly to a growing group of indexes and the exchange-traded products and other funds and investment products that track them. The majority of these indexes seek to enhance returns or minimise risk relative to a traditional market-capitalisation-weighted benchmark. Others seek to address oft-cited drawbacks of standard benchmarks, such as the overweighting of the most-indebted issuers in market-cap-weighted fixed-income...

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Which ETFs Will Be Boosted by the Bond Buying?

Market News - August 12, 2016

The outlook for the UK economy has been revised down in the wake of the vote in favour to leave the EU. To address that risk, the Bank of England decided at its August 2016 meeting to provide further monetary stimulus, bringing interest rates to a new historical low of 0.25% and expanding the quantitative easing programme by £70 billion, of which £10 billion in corporate bonds and the remainder in the gilts. Judging...

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Gold ETFs Net €3bn Safe Haven Inflows in 3 Months

Market News - July 20, 2016

The European exchange-traded-fund market netted in close to €8 billion of new money in the second quarter of 2016. This represented a decline from the €11 billion of net inflows registered in the first quarter. Assets under management at the end of the second quarter amounted to €482.4 billion; a 4.2% increase from €462.9 billion at the end of the previous period. Given the general investment environment in the second...

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Why Have Emerging Market Income ETFs Underperformed?

Market News - July 7, 2016

Rock-bottom interest rates have created a challenging environment for investors eyeing a decent and fairly reliable income stream. Many investors are turning towards dividend-oriented strategies to compensate for the low yields bonds offer. Aside from providing investors with income, dividend paying companies tend to have stronger corporate governance structures in place. As such, dividend equity funds often provide access to better quality holdings, but this is not always the case. While many investors...

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