ETF assets in the US continued to show strong growth as of end November 2013, through a combination of net inflows and appreciation in US equity markets. The table below shows a summary of assets for all US listed ETPs. It provides a useful snapshot of how assets for all US listed ETFs are currently allocated by type of exposure / strategy.
This table is excerpted from our upcoming monthly ETF Landscape and Risk report. The report includes an overview of the ETF landscape (total assets, number of ETPs) and some risk metrics for ETFs.
A complete updated list of all… see full post
Professional managers often observe that during times of market stress (such as in 2008), correlations between asset classes tend to converge. Most asset allocation models are based on certain correlation assumptions between asset classes and securities. We coined the term ‘ETF Correlation Drift’ as a simple way to track if correlations between ETFs have changed recently relative to longer term trends.
We measure ETF Correlation Drift as the difference between short term correlation (past 6-month returns) and long term correlations (past 5 year returns) for any given pair of ETFs.
Recently US bond ETFs (e.g. AGG, the iShares Barclays Aggregate Bond… see full post
The following is a short excerpt from our upcoming monthly ETF risk landscape report. The report includes an overview of the ETF landscape (total assets, number of ETPs) and some risk metrics for ETFs. Sign up for a complimentary copy of the report.
In theory, asset managers are evaluated against index benchmarks by their asset-owner clients. In practice, asset-owners (both retail and institutional) want to avoid significant portfolio drawdowns even if the benchmark index declines. This chart makes it easy to compare key ETFs on the max drawdown they have experienced in the trailing 5 years. We then compare… see full post
As of Sep 29, 2013 global ETP assets were ~ $2.3Tn (including all ETF, ETN and ETC products). The table below shows the net assets and market share for the top 20 ETP sponsors. Readers interested in our periodic ETF market summary reports can sign up here.
A couple of observations as we look at the numbers:
The top 3 players (Blackrock, State Street and Vanguard) continue to dominate with an aggregate 67% global market share. However share numbers could change as players like Fidelity, PIMCO and Schwab commit more resources to this space.
The numbers are also influenced by a few… see full post
As the Exchange Traded Fund (ETF) universe continues to expand, both retail and professional investors need access to high quality education, data and tools around these popular products. To make this task simpler, I have compiled a list of what I believe are the highest quality ETF data and resources available online.
Full disclosure: In the list I have also included resources produced by my firm First Bridge, but only in those categories where we have highly specialized expertise that justify our inclusion.
Best ETF 101 content:
An excellent starting point for the ETF novice and it begins by addressing the… see full post
The pie chart and table below show the breakdown of all US ETF assets by type of ETF. It makes it visually easy to see which asset classes and types of strategies currently have the most ETF assets. The ETF data is sourced from the First Bridge ETF database that includes a current and complete ETF list, daily ETF holdings and ETF reference data.
Not surprisingly, equity ETFs (domestic and international exposure) still account for approximately 75% of all US listed ETF assets. Also, more traditional ETFs such as market cap weighted ETFs… see full post
The universe of ETFs is constantly evolving, with both new launches and closures. The table below makes it visually easy to see the range of net expense ratios (fees) for the different types of ETFs listed in the US. It draws from our comprehensive ETF data set (which includes daily ETF holdings and classifications). All ETF data is as of Sep 9, 2013 and includes all ETFs currently listed in the US (including those with announced closures)
Note: When looking at the table it is important to keep in mind that the term ETF is used as shorthand to refer… see full post
There have been 100 ETF & ETN launches in 2013 through Aug 29, 2013. We have categorized them in the table below, to see what types of ETFs have launched this year. It reflects what investors are demanding in the current environment as well as the efforts by sponsors to plug gaps in their product lineups.
The table below classifies the YTD ETF launches first by asset class and then by specific exposure or strategy.
- Income oriented ETFs: The dominant theme in ETF launches this year has been ‘income’, cutting across asset classes. There have been 5 high yield bond… see full post
In the last few months, two major index providers (Russell & MSCI) have announced that they will downgrade Greece from ‘Developed’ to “Emerging’ in their index classification systems. Hypothetically, this could impact ETFs in two ways:
- ETFs that track global MSCI and Russell indices will need to buy and sell their holdings in Greek stocks based on the changes to the underlying indices.
- ETFs that track other indices but have significant holdings in Greek equities, may be impacted based on the ‘signaling’ effect of this re-classification.
To analyze this, we used the First Bridge ETF holdings database to see which… see full post
When should ETF investors analyze the constituents (holdings) of the ETFs in their portfolios? In theory, the answer is: ‘all the time’. Knowing what you hold is important and ETFs are a great tool for enhancing portfolio transparency.
In practice however, both individual and professional investors don’t have the time to keep track of ETF constituents. A good rule of thumb is to distinguish between ETFs that track ‘traditional’ asset classes vs. those that provide access to a specific strategy or investment factor. Examples of the former are US large cap equities or municipal bonds. Examples of the latter are… see full post