FactSet has launched the FactSet Global FinTech Index, tracking the performance of global companies providing disruptive technologies to the financial services space including those engaged in electronic payment processing, credit card technology, financial & compliance ERP software and point-of-sale terminal manufacturing. The index is designed to serve as the underlying for future ETFs which would compete with existing FinTech funds from Global X and PureFunds.

The European ETF market attracted €11.5bn in net new money in the fourth quarter of 2016, bringing the grand total for the year to €47.9bn, according to Morningstar’s latest ETF fund flows report. While equity ETFs closed the year with net inflows of €13.6bn, the region’s success story was fixed income ETFs, pulling in €20.6bn in net new money and increasing their market share to 24.1%. Jose Garcia-Zarate, Associate Director of Passive Strategies Research for Morningstar, commented: “All ETF providers concur in identifying fixed income as one of their key growth areas in the coming years.”

Source has unveiled the Source Bloomberg Commodity UCITS ETF (LON: CMOD), a new fund tracking the well-known Bloomberg Commodity Index, and the latest addition to the firm’s “portfolio essentials” range of ETFs. At a cost of 0.40% per annum, investors may receive diversified exposure to over 20 commodities across the agriculture, energy, industrial metals, precious metals and livestock sectors. The fund will compete with existing funds from ETF Securities and UBS which track the same index.

Nutmeg has streamlined its fee structure and reduced costs for more than two thirds of its customers. Doing away with the previous four fee brackets, ranging between 0.3% and 0.95% depending on customer investment levels, Nutmeg will adopt a simpler two-fee-bracket structure for its actively managed portfolios, constructed exclusively with ETFs. Customers will now pay 0.75% on the first £100,000 of investments, and 0.35% on all investments above £100,000. Martin Stead, CEO of Nutmeg, said: “The fees you pay can make a significant difference over time – even a tiny reduction can make a massive saving over 20 or 30 years.”

By Naoki Kamiyama, Chief Strategist, Nikko Asset Management.
Higher export volumes have helped Japan’s economy continue its improvement this year (2016), with growth of 2.2% (annualised) during the September quarter. This marks the third quarter in a row where Japan’s economy has expanded due to a boost in export volumes. This growth, however, has been offset somewhat by weaker domestic spending, with some concerned that the benefits of Prime Minister Abe’s stimulus package have not yet made their way through to the Japanese consumer.

By Francesc Balcells, portfolio manager at PIMCO.
Turkish asset prices have come under heavy pressure recently, and the Turkish lira fell to a record low against the US dollar in January. Investors seem focused on three mutually reinforcing factors: Turkey’s large foreign currency refinancing needs, balance sheet mismatches across the corporate sector and insufficient foreign currency reserves. Complicating matters, the political environment constrains, and even resists, economic adjustment.

By Luke Spajic, portfolio manager at PIMCO.
Clearly, investors in China are on edge: Over the past few months, the Chinese yuan’s decline and capital outflows have continued apace, while the People’s Bank of China (PBOC) has taken steps to tighten financial conditions. Adding to the nerves, a little over a year ago, a rate hike similar to the one last month by the Federal Reserve precipitated a downward spiral in the yuan and steep declines in equity and bond markets around the world.

GF International Asset Management has launched the GF International-FTSE China A UCITS ETF (LON: PRCE), becoming the second Chinese asset manager to independently launch an ETF in Europe. The physically replicating ETF tracks the FTSE China A Index, a diversified market capitalisation-weighted reference for the performance of over 700 Chinese A-shares, accessible via the Renminbi Qualified Foreign Institutional Investor (RQFII) scheme. Chuanhui Lin, CEO of GF Fund Management, commented: “This ETF will have an important role to play in promoting international investment in China.”

NYSE, in collaboration with Zebra Capital Management, has launched a US large cap equity index incorporating leading behavioural finance research on high-turnover, or “popular” stocks, with the goal of capturing higher returns with lower volatility. The NYSE Zebra Edge Index is founded on academic research by renowned economist Professor Roger Ibbotson. Ibbotson commented: “By removing the most popular and the most volatile stocks, you are left with less popular, less volatile stocks which have historically provided higher returns with less risk.”

BMO Global Asset Management has expanded its ‘Income Leaders’ suite of ETFs with the launch of the BMO MSCI Emerging Markets Income Leaders UCITS ETF (LON: ZIEM), providing exposure to emerging market equities with quality characteristics and high dividend yields. By including a quality screen, the ETF seeks to reduce portfolio volatility and boost the sustainability of dividend payouts. Marc Knowles, Director of ETFs Europe, BMO Global Asset Management, commented: “Investments in quality companies with lower debt levels can help to deliver enhanced risk adjusted returns.”