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Vanguard fires fresh salvo in asset management fee war
January 13, 2022-Chief executive Tim Buckley said Vanguard would cut $1bn from its investment fund fees by 2025 after reducing its charges by $140m last year.
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Source: ft.com
Newfound Research, Simplify Asset Management Announce Partnership and Launch of New Suite of Structured Alpha ETF Model Portfolios
January 12, 2022--Direct, efficient uses of diversification and leverage allow new open architecture portfolios to gain exposure to assets that may improve portfolio returns without a material increase in portfolio risk
Simplify Asset Management ("Simplify") and Newfound Research ("Newfound") are today announcing a new partnership designed to provide investors with a modern approach to navigating modern markets.
As part of their combined efforts, Newfound has launched the Structural Alpha Series of ETF model portfolios powered by Simplify's innovative family of Exchange Traded Funds.
There are four portfolios in the initial Structural Alpha suite: Conservative, Conservative Growth, Moderate Growth and Growth. The portfolios are built using an open architecture approach, including funds from a variety of providers.
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Source: Simplify Asset Management Inc.
Coinbase Buys Futures Exchange in Crypto Derivatives Push
January 12, 2022-- Biggest U.S. crypto exchange acquires FairX marketplace
Purchase could expedite efforts to diversify product portfolio
Coinbase Global Inc. is acquiring futures exchange FairX in its biggest step yet toward expanding into crypto derivatives.
Already registered with U.S. regulators. the firm could give Coinbase the edge it needs in getting a derivatives marketplace up and running. Terms of the deal were not provided.
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Source: bloomberg.com
Five charts explaining why inflation is at a 40-year high
January 12, 2022--The bumpy economic recovery has had policymakers, economists and Americans households grappling with greater price hikes for groceries, cars, rent and other essentials.
The latest inflation data, released by the Bureau of Labor Statistics, showed prices in December rose to a 40-year high, climbing 7.0 percent compared with the year before.
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Source: washingtonpost.com
Federal Reserve-Beige Book
January 12, 2022-Overall Economic Activity
Economic activity across the United States expanded at a modest pace in the final weeks of 2021. Contacts from many Districts indicated growth continued to be constrained by ongoing supply chain disruptions and labor shortages. Despite the modest pace of growth, demand for materials and inputs, and demand for workers, remained elevated among businesses.
Lending activity picked up slightly toward the end of the year, led by commercial real estate borrowers. Consumer spending continued to grow at a steady pace ahead of the rapid spread of the Omicron COVID-19 variant.
Most Districts noted a sudden pull back in leisure travel, hotel occupancy and patronage at restaurants as the number of new cases rose in recent weeks. Although optimism remained high generally, several Districts cited reports from businesses that expectations for growth over the next several months cooled somewhat during the last few weeks. The manufacturing sector continued to expand nationally, with some regional differences in the pace of growth. Overall activity in the transportation sector expanded at a moderate pace. While farm incomes were elevated throughout 2021, agricultural conditions were marred by drought conditions across several Districts.
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Source: federalreserve.gov
Simplify Adds Three Funds to Its Suite of Equity ETFs Offering Downside Convexity
January 11, 2022--New ETFs provide exposure to U.S. small caps, Developed ex-U.S., and Emerging Markets, respectively; all with systematic options overlays designed to boost performance during extreme market moves
Simplify Asset Management ("Simplify"), an innovative provider of Exchange Traded Funds ("ETFs") designed to solve today's most pressing portfolio construction challenges, is today announcing the start of trading for three new funds that continue to highlight the firm's leadership in delivering sophisticated exposures with downside convexity.
Launching today are:
The Simplify US Small Cap PLUS Downside Convexity ETF (RTYD);
The Simplify Developed Ex-US PLUS Downside Convexity ETF (EAFD); and
The Simplify Emerging Markets PLUS Downside Convexity ETF (EMGD).
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Source: Simplify Asset Management Inc
KraneShares KBA First ETF to Track MSCI China A 50 Index in the US
January 5, 2022--Krane Funds Advisors, LLC, ("KraneShares"), an asset management firm known for its China-focused
exchange-traded funds (ETFs) and innovative investment strategies, announced that KBA now tracks the MSCI China A 50 Connect Index.
KraneShares updated the Fund's name to the KraneShares Bosera MSCI China A 50 Connect Index ETF(ticker: KBA) to reflect the change.
"KBA is the first MSCI-linked China A-Share ETF in the United States, and is now the first US-listed ETF to track the MSCI China A 50 Connect Index^1. "Since we launched KBA in 2014, we have evolved the Fund alongside MSCI based on the latest developments in the China A-share market," said Jonathan Krane, CEO of KraneShares.
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Source: bloomberg.com
Minutes of the Federal Open Market Committee, December 14-15, 2021
January 5, 2022--Developments in Financial Markets and Open Market Operations
The manager turned first to a discussion of financial market developments over the period. Financial markets responded to significant new information about the economy and monetary policy, as well as the emergence of the Omicron variant. Overall, domestic financial conditions tightened modestly but remained near historically accommodative levels. Expectations for an earlier reduction in Federal Reserve policy accommodation lifted short-term interest rates and supported the dollar.
While prices of equities that are sensitive to COVID-19 risks declined significantly, the S&P 500 index was little changed.
Over the period, market participants considered potential drivers of the notable decline in far-forward sovereign yields in the United States and other advanced economies. News of the Omicron variant reportedly drove safe-haven flows into sovereign bonds, pushing term premiums lower. The significant co-movement between far-forward yields and the share prices of firms most affected by social distancing was consistent with this interpretation. In addition to the effects of the pandemic on risk sentiment, some discussed the potential for COVID to become endemic, possibly resulting in modestly lower potential growth over time and a lower long-run neutral level of the federal funds rate.
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Source: federalreserve.gov
SEC Delays Decision on NYDIG's Spot Bitcoin ETF Proposal
January 4, 2022--The commission now has until March 16 to approve or disapprove NYDIG’s proposal.
The U.S. Securities and Exchange Commission (SEC) has extended the time period for ruling on NYDIG's proposal for a spot bitcoin exchange-traded fund (ETF) by 60 days in order to have "sufficient time to consider the proposed rule change and any comments received."
The SEC's original deadline was Jan. 15, so now it has until March 15 to make a decision.
In recent months, the SEC has rejected spot bitcoin ETF proposals from a number of investment companies, including VanEck, WisdomTree and Kryptoin.
It also recently delayed its decisions on spot bitcoin ETFs from Valkryie, Grayscale and Bitwise. Grayscale is owned by Digital Currency Group, which is the parent company of CoinDesk.
In the past, the SEC has typically postponed its decisions on approving bitcoin ETFs for as long as possible.
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Source: coindesk.com
Passive ETFs hit by billion-dollar rebalancing costs
January 4, 2022--Research shows US index trackers lose out on nearly $4bn a year due to price moves created by front-running
US index-tracking funds are throwing away $3.9bn a year by using predictable, mechanical trading strategies that are exploited by nimbler market participants, according to academic research.
The losses would cost an investor who built up a $2m retirement portfolio over 30 years via passive mutual or exchange traded funds $29,000, the analysis found.
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Source: ft.com
