Global ETF News Older than One Year
To Safeguard Global Financial Stability, Boost the Resilience of Investment Funds
September 17, 2021--Our brush last year with one of the biggest economic shocks of our lifetimes revealed some fundamental vulnerabilities that could affect global financial stability. Caught up in the financial market turmoil generated by risk averse investors, many investment funds were heavily affected by the "dash-for-cash" that extended across borders-and which triggered significant outflows from risky assets and from emerging and developing economies.
As this happened, and investor capital flowed out of money market and open-end mutual funds, asset managers were forced to fire-sell these assets, which accelerated the drying up of liquidity and the drop in market value of key assets.
Source: IMF
IMF-Departmental Paper-Investment Funds and Financial Stability: Policy Considerations
September 17, 2021--Summary:
The paper's analysis underscores the importance of the ongoing Financial Stability Board-led process of identifying policy options, involving national authorities and the International Organization of Securities Commissions and other standard setters.
In this context, the global nature of the investment fund business and fungibility of financial flows makes it vital to ensure consistency of global policy choices that can secure financial stability by precluding regulatory arbitrage.
Source: IMF
Regulation and respectability amid the rapid evolution of cryptoassets
September 16, 2021--If recent news is anything to go by, the cryptoasset industry is continuing to evolve at breakneck pace.
In the last few weeks alone, El Salvador became the first country to accept digital currency as legal tender, the UK's Financial Conduct Authority (FCA) called for more powers to protect consumers from risky crypto ventures promoted by influencers like Kim Kardashian, and Jay Clayton (former head of the Securities and Exchange Commission) became the latest high-profile regulator to turn to the crypto industry.
Despite this rapid transformation, many observers still think of it as being akin to the Wild West after the Silk Road darknet marketplace or criminally-complicit trading exchange Liberty Reserve-scandals that marred crypto's early years.
Source: ukfinance.org.uk
Trackinsight-ETF markets in focus: August 2021-Investors have flocked to ETFs over 2021, adding $789 Billion of flows year-to-date
September 16, 2021---ETFs on track to hit $10 trillion AuM, but European ETF flows slow
Having smashed through the $9 Trillion AuM barrier in July, growth continued, but slowed over August, according to the latest data from Trackinsight, setting the industry up for a record-setting year of unprecedented growth and issuance.
Over August, the 7,400 ETFs covered by Trackinsight saw $86.2 Billion of new flows to command a total of $9.32 Trillion in AuM. Investors have flocked to ETFs over 2021, adding $789 Billion of flows year-to-date.
Competing for this wave of new money are over 559 new ETFs which have launched this year, including over 160 actively-managed ETFs and 119 ESG ETFs. This far exceeds the 458 launches seen in 2020, indicating that ETFs have become the preferred distribution technology for asset managers promoting their investment ideas.
Source: trackinsight.com
G20 GDP growth slows to 0.4% in the second quarter of 2021, but large differences exist across countries
September 15, 2021--Gross domestic product (GDP) of the G20 area grew by 0.4% in the second quarter of 2021, down from 0.9% in the first quarter of 2021. However, this figure conceals large differences in the growth observed across countries.Among the G20 economies, GDP growth slowed in Turkey(to 0.9%, from 2.2%),Korea(to 0.8%, from 1.7%) and Australia(to 0.7%, from 1.9%). GDP contracted sharply in India(by (minus) 10.2%, after 2.3% growth).
GDP also contracted, to a lesser extent, in Canada (by (minus) 0.3%, after 1.4% growth) and Brazil (by (minus) 0.1%, after 1.2% growth). GDP growth resumed in the United Kingdom(to 4.8%, following a contraction of (minus) 1.6%),in the European Union as a whole (to 2.1%, following a contraction of (minus) 0.1%), in Germany (to 1.6%, following a contraction of (minus) 2.0%), in Saudi Arabia (to 1.1%, following a contraction of (minus) 0.5%) and in Japan(to 0.5%, following a contraction of (minus) 1.1%).
Remaining G20 economies recorded accelerating growth rates in the second quarter of 2021: Italy (2.7%, from 0.2%), the United States (1.6%, from 1.5%), Mexico(1.5%, from 1.1%), China and Indonesia (1.3% in both countries, from 0.4% and 0.3%, respectively) and France(1.1%, from 0.0%).
Source: OECD
How Can Cities Tackle Climate Change & Biodiversity Loss in Nature-Smart Ways?
September 14, 2021--Every day, the world awakens to news of another heatwave, flood, drought, tropical cyclone, wildfire, or other climate-induced natural hazard. The new report by the Intergovernmental Panel on Climate Change (IPCC) gives a code-red climate warning, with a forecast for global warming of 1.5℃C by 2040.
The global community has grown ever more aware that biodiversity, climate change, economic prosperity, the well-being of people, and the health of the planet are interconnected.
And cities are of particular concern: They consume 78 percent of the world's energy and produce more than 70 percent of greenhouse gas emissions. Moreover, seven of 10 people are projected to live in cities by 2050, so urban areas aren't just a contributor to climate and biodiversity challenges; they also have the unique opportunity to address them in a sustainable, lasting way.
Source: World Bank
Sustainable Financing and Investing Survey -Global Report
September 13, 2021--New roles and responsibilities for issuers and investors gains potency and permanence
The revolution in how companies and institutional investors see their role and responsibility on social and environmental issues has continued to gain strength and momentum in the past year.
Indeed, if the pandemic helped provoke a reassessment of the relationship the capital markets have with society, its participants are now actively redefining this relationship with sustainability increasingly at the core. Such profound change is evidenced in our fifth annual global survey of 2,000 capital markets issuers and institutional investors, conducted during May and June.
Powerfully, it shows that in addition to values underpinning why companies and investors care about these issues -89% of issuers and investors say they are important -the financial benefits of doing so are now recognised more widely than before. In fact, 51% believe that paying attention to these issues can help improve returns or reduce risk, which is the highest percentage in three years.
Source: gbm.hsbc.com
Bassanese Bites-Stagflation
To be sure, the Fed's Beige Book review on the economy did note a modest downshift in activity during August with fewer people travelling and eating out as delta cases mount. At the same time, business also reported cost pressures and difficulty in attracting staff. Add to the mix Friday's report of another solid gain in producer prices during August, and general commentary from Fed speakers suggesting most are still keen to announce a tapering in bond purchases by year-end despite short-run delta uncertainties.
Source: betashares.com.au
Demand for advice rises as not all investors go it alone
Growing demand for advisory services in the wake of the pandemic has ignited a race among asset managers to acquire customers needing help to navigate volatile markets.
But the investment climate has also spurred demand for financial advice, via pure digital or "robo" services, as well as more hybrid models that combine technology with a human touch. view more
Source: ft.com
Crypto ETF assets treble as investors take risks
The bulk of the $9tn exchange traded funds industry consists of plain vanilla index trackers focused on mainstream assets. But a couple of much higher risk variants are now growing rapidly-albeit from a low base.
Source: ft.com
Global markets
U.S. stocks sagged last week-absent any clear trigger -reflecting general concerns with a combination of weakening growth due to delta, but also persistent pricing pressures due to lingering supply bottlenecks, or what some are already over-excitedly suggesting is a return to 'stagflation'.
September 13, 2021--Alongside a surge in retail share trading, traditional and 'robo' advice is being sought
New share trading account openings have surged over the past year, against a backdrop of strong market gains and central bank support stimulus measures that have kept interest rates low- all of which have increased the risk tolerance of some retail investors.
September 13, 2021--Regulators and advisers are divided on digital currency and 'inverse' funds
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