Welcome to Issue 12 of Exchange Traded Fridays for the week ending 8th October 2021. In this week's news we saw a new ETF launch from ETF Securities playing on the hydrogen thematic as well as more information about market makers thanks to Russell Investments and Nine Mile Financial. Globally, we saw more info on bitcoin ETFs, a run through of active ETFs and exposure to China for US Equity ETFs. What's in this newsletter?
Local ETF Articles
Global ETF Articles
ETF Videos
ETF Podcasts
Tweet of the week
Chart of the week
ETF Education
ETFtracker App Links
ETFtracker Forum
Listen or Watch
Articles - Local ETF Strategy - ETF Securities launches Australia’s first hydrogen ETF - This one talks about the launch of the new HGEN ETF from ETF Securities which tracks the Solactive Global Hydrogen ESG Index. It marks another ESG listed play for Australian ETFS and will cover 30 stocks. More info on this video from ETF Securities.
Russell Investments - ETF Market Making – how and when to trade ETFs efficiently In this article we take a look into the world of the ETF market maker in a bit more detail as well as the 2 Russell Investments Equity ETFs (RDV and RARI). They go through a day in the life in this interview with Nine Mile Financial who we recently had on our Interviews with Experts podcast featuring Kevin Feerick from the firm (see it here on YouTube: https://www.youtube.com/watch?v=TgXiIISUxs8&ab_channel=ETFtracker. If you've ever wanted to learn more about what ETF market makers do, this is a great article for you.
ETF Securities - Weekly Report - w/e 1st October - Per ETF Securities. "Short Nasdaq 100 fund SNAS was the week’s overall top performing fund, followed by short Australian equities fund BBOZ and short US fund BBUS. Energy companies ETF FUEL was the best performing unleveraged fund on the back of rising oil prices, followed by China fund CETF and global banks fund BNKS. Tech-heavy funds underperformed for the week, with RBTZ, SEMI, ROBO and ATEC all falling by more the 5% last week." Click the link to see the summary and access to the full report.
Articles - Global Financial Times - Up to a quarter of US equity ETF revenues derived from China - from the home of the ETF Hub at the FT.com we see analysis by Bank of America showing that the correlation between EPS (earnings per share) in the S&P 500 and Chinese economic growth went from nothing a decade ago to 90% which made it a more important contributor than US GDP was for those stocks. It identifies some other stats there too such as the 303 companies globally with market cap greater than $9 trillion and who derive at least 5% revenue from China. As you see from their chart below, some sectors are more exposed than others.
FT.com chart - BofA ETF Research, Bloomberg
In this article, it describes the new team-up between Loomis Sayles and State Street's SPDR ETF brand to create the Opportunistic Bond ETF (OBND) which will track a multi-asset credit strategy and is an active ETF. This also coincides with Issue 10 of Exchange Traded Fridays (see here - https://www.etftracker.com.au/post/exchange-traded-fridays-issue-10-24th-september-2021) where we highlighted an Australian local listing for Loomis Sayles Global Equity fund (LGSE). CoinTelegraph - Futures-based Bitcoin ETF has '75% chance of approval' in October — Analyst - in this article the discussion is about the 75% chance of seeing a bitcoin futures based ETF approved by the US SEC in the coming weeks, despite continued delays on a bitcoin ETF.
FINews - Active ETFS : A Guide for Investors - In this guide from FINews they go through the details about Active ETFs and the advantages (but also disadvantages of them). There's details about the market as a whole which shows $345 billion in Active ETFs globally as of July 2021 (up from only $110 billion in July 2018 and $72 billion in July 2016). Despite the US focus of this article, the points around active vs passive are still relevant.
Videos ausbiz - Forrest to Wikramanyake: why now is the time to launch a hydrogen ETF - 6th October - In this episode, Kanish Chugh from ETF Securities discusses their new ESG opportunity with the newly launched HGEN ETF tracking the hydrogen megaplay. 6mins
ausbiz - Is Bitcoin about to decouple from the rest of the crypto market? - 5th October - In this episode Stephen Cole from Trammell Investment Partners discusses the potential for a bitcoin ETF in the US. He also discusses the treatment from the SEC and how this cycle could be the beginning of that change led by ETF approval and increased corporate treasury adoption. 8mins
ausbiz - China's pain is Japan and India's gain - In this episode, Cameron Gleeson from BetaShares goes through the ETFs focused on India and Japan when it comes to the issues being faced in China. 4mins
The ETFtracker Show - Interviews with Experts - Episode 8 - Active ETFs and ESG with eInvest - In this episode we speak with Emilie O'Neill all about active ETFs, ESG, greenwashing and more. Check it out if you have not already. 32mins
Podcasts ETF Edge (by CNBC) - How to play Commodities - Short segment from the crew as they go through ways to play the global commodity surge. 9mins
The Alpha Females Invest - Stockbroking - The Benefits of a Broker - In this episode the team chat with Julian Hewitt from Bell Potter Securities all about the value that a broker can provide from portfolio management to diversification and stock selection. An important one if you are contemplating active ETFs as the concepts are similar. 34mins
You're In Good Company - Deepdive into ETFs | YIGC with The Leungway - In this episode the crew chat with Jess Leung who is a portfolio manager as well as social media star with her Instagram and TikTok (@theleungway). They talk all things ETF so check it out. 32mins
Tweet of the week Tweet from Mike Akins at ETF Action taking a look at other ways to get bitcoin exposure, via the blockchain related ETFs.
Chart of the Week In this week's chart we look at some of the factor based ETFs on the ASX and how they've been tracking so far including QUAL, WDMF, QHAL, QLTY and EMKT. They're all global focused (and 1 ex Australia Global) with the last being emerging markets. Interesting to see how these compare to other ETF groupings which you can access on Google Finance and see preset groupings here on our website: https://www.etftracker.com.au/google-finance
Further ETF Education Info on market makers from Vanguard's Education Centre is the ETF Education piece for this week and it's a function that, whilst does not get seen in your day to day trading, your trades would not occur as easily if it were not for the market makers. The creation redemption process is a big part of what makes ETFs such a unique and valuable product. https://www.vanguard.com.au/adviser/en/etf-knowledge-trading/who-are-the-key-players-tab
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ETFtracker Podcast and Videos Before we go further, if you'd prefer to consume all this content in more convenient forms of media, we've launched The ETFtracker Show as a podcast and video and Exchange Traded Fridays comes at the end of each week. Additionally, we've launched a series of interviews with various ETF market participants.
You can also access the podcast directly on our website here: https://www.etftracker.com.au/podcasts