Americas ETP News
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ETF industry observers advise caution when adjusting portfolios
March 1, 2024--Global elections, regional conflicts and sky-high US equity prices might test the patience of investors this year
Passive investors whose ethos is to try to take very long-term views on their portfolio construction face some hard choices.
This year, a record number of people globally will go to the polls, conflicts in Ukraine and the Middle East show no signs of abating and on a purely technical basis investors have to ask themselves whether the US market, which tends to have a heavy weighting in many portfolios, can continue to trade at record highs.
Andrew Prosser, head of investments at InvestEngine, a UK neobroker that provides DIY and model portfolio solutions using ETFs, advises patience.
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Source: ft.com
Regan Capital Launches the Regan Floating Rate MBS ETF (NYSE: MBSF)
February 28, 2024--Veteran asset-backed securities portfolio manager Skyler Weinand launches MBSF, an actively managed exchange-traded fund that invests in floating rate Residential Mortgage-Backed Securities.
Regan Capital, an investment firm with $1.3 billion in assets under management, today announced the launch of the Regan Floating Rate MBS ETF (NYSE: MBSF), an actively managed exchange-traded fund that invests primarily in floating rate Agency Residential Mortgage-Backed Securities (RMBS).
Agency RMBS typically offer higher yields than Treasury bonds without significant additional risk, since Agency RMBS are issued by government sponsored entities, such as Fannie Mae and Freddie Mac.
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Source: Regan Capital, LLC
Xtrackers by DWS Launches its First Active ETF: NRES
February 27, 2024--Global Natural Resources Fund Combines Strength of DWS' Xtrackers Platform and Liquid Real Assets Expertise
DWS, one of the world's leading asset managers, announced today the listing of its first actively-managed exchange-traded fund (ETF), the Xtrackers RREEF Global Natural Resources ETF (NASDAQ: NRES) (the "Fund").
The Fund is designed to provide investors with exposure to global natural resources (GNR) companies primarily through investments in equity and equity related securities. The Fund seeks total return from both capital appreciation and current income and, as an actively managed ETF, does not seek to replicate the performance of a specific index.
For DWS, this listing marks its entry into the fast-growing actively managed ETF market in the US[1]."More and more investors are recognizing the advantages of this form of investment. Active strategies can adapt to a wide range of market conditions, especially in times of great uncertainty," says Arne Noack, Head of Systemic Investment Solutions, Americas. "Adding the actively managed Xtrackers RREEF Global Natural Resources ETF to our range of US-listed ETFs, combines two of DWS’ global core competencies and expands the range of best-in-class specialty investment solutions, while leveraging the liquidity, cost efficiency, transparency, and potential tax benefits of the ETF structure."
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Source: dws.com
Synthetic convertible ETF aims at Magnificent Seven bond problem
February 26, 2024--Despite their outsized influence, megacap US companies cannot be accessed by traditional convertible bond investor
The world's largest convertible bond manager has unveiled a "synthetic convertibles" exchange traded fund to spread the concept to companies that are so cash-rich they do not need to issue real bonds.
Last year saw a boom in convertibles - a type of bond that can be swapped for shares if a company's stock price hits a pre-agreed level-with issuance jumping 77 per cent to $48bn, according to LSEG.
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Source: ft.com
Global X ETFs hires CEO from Goldman Sachs AM after senior executive exodus
Ryan O' Connor joins
February 22, 2024--Global X ETFs has appointed Ryan O'Connor as its new chief executive officer, following a senior management exodus at the firm.
Effective from 8 April, O'Connor will be responsible for driving the firm's strategy, 'reinvigorating" its product suit and leading the team into a "new, growth-focused era".
Prior to joining Global X, he was global head of ETF product at Goldman Sachs Asset Management. He was originally hired by the firm in 2017 to build its US fund strategist model portfolio business. Global X ETFs CIO to exit-amid senior management exodus O'Connor also spent over a decade at State Street Global Advisors, where he led product and capital markets teams for the SPDR ETF franchise.
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Source: investmentweek.co.uk
SEC Charges Van Eck Associates for Failing to Disclose Influencer's Role in Connection with ETF Launch
February 16, 2024-The Securities and Exchange Commission today announced that registered investment adviser Van Eck Associates Corporation has agreed to pay a $1.75 million civil penalty to settle charges that it failed to disclose a social media influencer's role in the launch of its new exchange-traded fund (ETF).
According to the SEC's order, in March 2021, Van Eck Associates launched the VanEck Social Sentiment ETF (NYSE:BUZZ) to track an index based on "positive insights" from social media and other data.
The provider of that index informed Van Eck Associates that it planned to retain a well-known and controversial social media influencer to promote the index in connection with the launch of the ETF. To incentivize the influencer's marketing and promotion efforts, the proposed licensing fee structure included a sliding scale linked to the size of the fund so, as the fund grew, the index provider would receive a greater percentage of the management fee the fund paid to Van Eck Associates. However, as the SEC's order finds, Van Eck Associates failed to disclose the influencer’s planned involvement and the sliding scale fee structure to the ETF’s board in connection with its approval of the fund launch and of the management fee.
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Source: SEC.gov
US investors in emerging markets switch to ETFs that exclude China
February 15, 2024--Portfolios are being adjusted as tensions and state intervention weigh on Chinese stocks
Emerging markets investors in the US are snapping up exchange traded funds with no exposure to China.
The net capital inflow into eight US-listed emerging markets ETFs that exclude China more than tripled to $5.3bn last year. 55 China-focused ETFs suffered combined net outflows of $802mn in 2023, compared with inflows of $7.5bn in the previous year.
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Source: ground.news
JPMorgan, State Street leave major investor climate group
January 15, 2024--The investment divisions of JPMorgan Chase and State Street are leaving a climate-friendly investment initiative, sparking cheers from Republicans.
A spokesperson for the group, Climate Action 100+, confirmed via email that "JP Morgan Asset Management and State Street Global Advisors have left the initiative."
The spokesperson also said BlackRock transferred its participation from its U.S. division to BlackRock International.
The changes come after the group last summer announced its next phase that would call on participants to "move from words to action" by "taking action to actively reduce greenhouse gas emissions across the value chain."
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Source: thehill.com
Morgan Stanley IM files to replicate Vanguard's multi-share class structure in ETF rivalry race
February 12, 2024--Fifth firm to file
Morgan Stanley Investment Management has applied for permission to house an ETF multi-share class structure, becoming the fifth asset manager to seek approval on the move.
In a filing for ETF Operational Relief with the Securities and Exchange Commission on January 29, Morgan Stanley IM said it was pursuing "multi-class structure" open-ended products, which would see the firm add an ETF share class to its existing mutual funds.
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Source: investmentweek.co.uk
IMF Working Paper-U.S. Inflation Expectations During the Pandemic
February 9, 2024--Summary:
This paper studies how and why inflation expectations have changed since the emergence of Covid-19. Using micro-level data from the University of Michigan Survey of Consumers, we show that the distribution of consumer expectations at one-year and five-ten year horizons has widened since the surge of inflation during 2021, along with the mean. Persistently high and heterogeneous expectations of consumers with less education and lower income are mainly responsible.
A simple model of adaptive learning is able to mimic the change in inflation expectations over time for different demographic groups.
The inflation expectations of low income and female consumers are consistent with using less complex forecasting models and are more backward-looking. A medium-scale DSGE model with adaptive learning, estimated during 1965-2022, has a time-varying solution that produces lower forecast errors for inflation than a variant with rational expectations. The estimated model interprets the surge of inflation in 2021 mainly as the result of a price markup shock, which is more persistent and requires a larger and more persistent monetary policy response than under rational expectations.
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Source: imf.org
