First Trust launches ‘Value Line Dividend’ ETF in Europe

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First Trust launches US ‘Value Line Dividend’ ETF in Europe

First Trust has brought another of its blockbuster US strategies to Europe with the launch of the First Trust launch Value Line Dividend Index UCITS ETF (FVD LN) on the London Stock Exchange. Linked to the Value Line Dividend Index, the fund provides exposure to a portfolio of quality US companies with low-risk and high-dividend characteristics. Gregg Guerin, Senior Product Specialist for First Trust, commented, “This latest addition to our equity solutions is a safety-first strategy that can provide investment managers with the potential for greater downside protection during periods of market volatility.”

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Latest news

Philippe Baché, Head of Fixed Income at Lyxor ETF

Lyxor rolls out trio of high-yield SRI bond ETFs

Lyxor has launched three new fixed income ETFs providing exposure to US dollar-denominated, euro-denominated, and global high-yield corporate bond markets while incorporating sustainability criteria. The funds are based on Bloomberg Barclays MSCI Sustainable SRI Indices and are being rolled out on the LSE and Borsa Italiana. Philippe Baché, Head of Fixed Income at Lyxor ETF, commented, “By applying an ESG lens to the high yield bond universe, we are able to provide a significant move away from parent indices offering a potentially more conservative risk profile.”

BlackRock targets emerging markets with new ESG Leaders ETF

BlackRock targets EM equities with new ESG Leaders ETF

BlackRock has launched a new socially responsible ETF providing exposure to emerging market equities with strong environmental, social, and governance (ESG) characteristics relative to their sector peers. The iShares ESG MSCI EM Leaders ETF (LDEM US), which is the firm’s second ETF to harness MSCI’s ESG Leaders methodology, has listed on Nasdaq Exchange and comes with an expense ratio of 0.16%. It has been seeded with $600 million from Finnish pension insurer Ilmarinen.

JP Morgan launches high yield multi-factor ETF in Europe

JP Morgan launches high-yield multi-factor ETF in Europe

JP Morgan Asset Management has launched its first fixed income multi-factor ETF in Europe. The JPMorgan Global High Yield Corporate Bond Multi-Factor UCITS ETF provides exposure to a globally diversified portfolio of high-yield corporate bonds from issuers with strong value, quality, and momentum characteristics.

Jonathan Krane, CEO of KraneShares

KraneShares launches China ESG equity ETF on LSE

China specialists KraneShares has announced the launch of the KraneShares MSCI China ESG Leaders UCITS ETF (KESG LN) on the London Stock Exchange. The fund, which is the issuer’s third UCITS ETF, is linked to the MSCI China ESG Leaders 10/40 Index, providing exposure to large and mid-cap companies domiciled in China with high environmental, social and governance (ESG) ratings relative to their sector peers. Jonathan Krane, CEO of KraneShares, said they were seeing “a lot of investor demand” for a China-focused ESG UCITS ETF.

Fixed Income

Vanguard launches global bond ETF in Canada

Vanguard Canada 1

Vanguard has launched a new fixed income ETF on Toronto Stock Exchange, providing low-cost exposure to a globally diversified portfolio of bonds issued across multiple sectors. The Vanguard Global Aggregate Bond Index (CAD-hedged) ETF (VGAB CN), which comes with a management fee of 0.30%, is designed to serve as a one-ticket solution covering the entire global investment-grade bond space.

Invesco launches Europe’s cheapest ultra-short US Treasury ETF

Invesco launches Europe’s cheapest ultra-short US Treasury ETF

Invesco has broadened its range of US Treasury bond ETFs with the launch of the Invesco US Treasury Bond 0-1 Year UCITS ETF on the London Stock Exchange. The fund is linked to the Bloomberg Barclays US Treasury Coupons Index and comes with an expense ratio of just 0.06%, becoming Europe’s cheapest ETF to focus on Treasury securities at the shortest end of the maturity curve.

Alternatives / Multi-Asset

First Trust launches actively managed merger arbitrage ETF

First Trust launches actively managed merger arbitrage ETF

First Trust Advisors has launched a new actively managed ETF in the US providing returns similar to those attributable to hedge funds pursuing merger arbitrage strategies. The First Trust Merger Arbitrage ETF (MARB US) has listed on NYSE Arca and comes with an expense ratio of 1.94%. Ryan Issakainen, Senior Vice President, ETF Strategist at First Trust, commented, “Since this ETF is expected to have low correlations to both stocks and bonds, we believe it will be an effective tool for investment professionals seeking to further diversify their clients’ portfolios.”

WisdomTree lists euro-denominated share class for Bitcoin ETP

WisdomTree Bitcoin ETP euros

WisdomTree has listed a new share class on SIX Swiss Exchange for the WisdomTree Bitcoin ETP. Trading under the ticker WBTC SW, the new share class allows investors with euros to directly access a liquid, physically backed investment in Bitcoin, the world’s largest cryptocurrency by market cap.

Commodities

Commodities prices slump in January

JIM Wierderhold S&P Dow Jones Indices

By Jim Wiederhold, Associate Director, Commodities and Real Assets, S&P Dow Jones Indices.

It was a tough start to the year for commodities. The S&P GSCI ended the first month of 2020 down 10.8%, the largest month-over-month decline since November 2018.

Invesco cuts fee on physical gold ETC

Chris Mellor, Head of EMEA ETF Commodity Product Management at Invesco

Invesco has reduced the expense ratio on its $7.6 billion physical gold ETC, from 0.24% per annum to 0.19%. Following the reduction, the Invesco Physical Gold ETC offers the joint-lowest fixed annual fee of any physical gold exchange-traded product available in Europe. According to Invesco, it is the lowest cost when looking at total cost of exposure. Chris Mellor, Head of EMEA ETF Commodity Product Management at Invesco, commented, “For a decade now, our physical gold ETC has offered investors an easy and efficient way to gain exposure to gold, and now for an even lower cost.”

Equities

Mitsubishi UFJ launches low-carbon Japanese equity ETF on TSE

Mitsubishi UFJ launches low-carbon Japanese equity ETF on TSE

Japanese asset manager Mitsubishi UFJ Kokusai AM has launched a new ETF providing broad exposure to Japan’s equity market while tilting in favour of sectors and companies with lower carbon emissions. The MAXIS Carbon Efficient Japan Equity ETF (2560 JP), which has listed on the Tokyo Stock Exchange, is linked to the S&P/JPX Carbon Efficient Index and comes with an expense ratio of 0.125%.

Quality access to international markets

Holly Framsted, Head of US Factor ETFs within BlackRock’s ETF and Index Investment Group.

By Holly Framsted, Head of US Factor ETFs within BlackRock’s ETF and Index Investment Group.

Uncertainty is keeping many investors within their home borders. Investing in the quality factor may help them access international opportunities while building portfolio resilience.

First Trust brings capital strength ETF strategy to Europe

Gregg Guerin, Senior Product Specialist for First Trust

First Trust has unveiled the First Trust Capital Strength UCITS ETF (FTCS LN) on London Stock Exchange. The fund, which replicates the strategy behind one of First Trust’s first US-listed ETFs, provides smart beta exposure to a portfolio of US-listed companies with strong balance sheets and less volatile stock prices. Gregg Guerin, Senior Product Specialist for First Trust, commented, “We are pleased to bring this rules-based strategy to market and believe FTCS offers advisers and wealth managers the potential for protecting in negative markets while participating in increasing markets.”

ETF and Index News

Amundi powers past €50bn AUM

Fannie Wurtz, Head of Amundi ETF, Indexing and Smart Beta

Europe’s largest asset manager Amundi has announced that its ETF business surpassed the €50 billion assets under management threshold in 2019. The milestone was reached through a combination of healthy market performance and robust net inflows with Amundi noting that demand was particularly strong for its suites of low-cost core and socially responsible ETFs. Fannie Wurtz, Head of Amundi ETF, Indexing and Smart Beta, commented, “In a highly dynamic market environment, these strong results demonstrate investors’ continued confidence in Amundi ETF and confirm our position as a leading ETF provider.”

ETF trends to watch in 2020

Jason Xavier, Head of EMEA ETF Capital Markets at Franklin Templeton Investments.

By Jason Xavier, Head of EMEA ETF Capital Markets at Franklin Templeton Investments.

Investors’ appetite across the globe for ETFs was strong in 2019 and shows little sign of slowing. The tailwind for ETFs going into not only a new year but a new decade couldn’t be stronger. Last year, global ETF assets under management surpassed $6 trillion, and in Europe, we broke $1 trillion in AUM. I’ve identified some themes that could continue/materialize in 2020 for ETFs globally.

Qontigo launches STOXX factor indices using Axioma risk models

Qontigo builds factor index suite off Axioma risk models

Qontigo has launched a suite of factor indices combining STOXX’s data and index technology with Axioma’s equity risk models. The suite has been launched with 30 indices covering six factors (value, momentum, size, low risk, quality, and a multi-factor strategy) across five developed market equity universes (global, global ex-US, US, Europe, and Asia Pacific).