Europe-listed ETFs saw net inflows of €7.8 billion in July 2017, bringing the total for 2017 to €65bn, according to data from Morningstar. While flows into Europe-listed equity ETFs posted a solid reading of €4.9bn, fixed income ETFs saw tepid demand during the month, recording flows of just €1.6bn, the second lowest monthly flows this year.

By Yu-Ming Wang, CIO, Nikko Asset Management.

As China’s economic development enters a more sophisticated and mature phase, it is beginning to challenge many of the status quos that have been taken for granted since the middle of the 20th century. With its large domestic market and huge savings pool, China does not simply follow the rules. China and its companies are becoming increasingly competitive, disrupting many long-established norms by leveraging various competitive advantages such as economies of scale, product differentiation and erecting higher barriers to new entrants.

European-listed ETF market flows remained steady in July with net new assets (NNA) over the month totalling €8.7 billion, according to monthly flows analysis from Lyxor. However, fixed income flows decreased to €2.3bn, close to the lowest monthly level of the year.

European ETF industry veterans Hector McNeil and Nik Bienkowksi have announced the launch of HANetf, Europe’s first independent “white label” UCITS ETF platform. The platform, which is not linked to any existing issuer, will provide third-party asset managers from around the world with the infrastructure to build and launch ETFs into Europe without having to establish their own full-service business. The pair aim to disrupt the market by lowering the barriers to entry for prospective new ETF issuers.

First Trust has become the largest provider of US-listed actively managed ETFs, based on AUM and number of funds offered –
according to data from Morningstar, as of the end of July, First Trust had $9.9bn invested across 29 US-listed actively managed ETFs. Ryan Issakainen, ETF strategist at First Trust, said: “First Trust has been highly selective in developing a diversified line-up of actively managed ETFs, focusing on categories where we believe active management offers competitive advantages over passive benchmark indices.”

The ROBO Global Robotics & Automation Index ETF (Nasdaq: ROBO) recently surpassed $1 billion in assets under management (AUM). Launched in October 2013, the ETF was the first to offer thematic equity exposure to companies involved in the production and use of robotics, automation and related technologies.

WisdomTree has cross-listed three UCITS-compliant ETFs into Mexico. The new listings, which include two broad equity funds and one broad commodity fund, bring the total number of WisdomTree ETFs listed on Bolsa Mexicana de Valores (BMV) to 42, made up of 32 US-listed ETFs and ten UCITS ETFs.

Blue Tractor Group has filed a third amended application with the US SEC for a new fund structure called a ‘Shielded Alpha ETF’. The proposed structure is an extension of a traditional actively managed ETF that does not require full portfolio disclosure on a daily basis. Consequently, Shielded Alpha ETFs allow active managers to fully obscure their proprietary alpha generation strategy from the market.

Exchange-traded funds and exchange-traded products listed globally gathered $43.5 billion in net new assets during July, bringing year-to-date (YTD) flows to $391.3bn and passing the $390.4bn recorded during all of last year, according to ETF industry consultant ETFGI. The strong demand for ETFs/ETPs during July marked the 41st consecutive month of positive net inflows for the industry.

Nikko Asset Management has bought a 15% minority stake in ARK Investment Management, a New York-based boutique provider of thematic ETFs targeting disruptive technologies. As part of the deal, Nikko AM will obtain exclusivity to offer ARK products and investment strategies in Japan and Asia Pacific. Catherine D. Wood, CEO and CIO of ARK, commented: “An entirely new market of investor will benefit now from Nikko AM’s ability to deliver disruptive innovation, which is transforming both industries and the global economy, through ARK’s investment strategies.”