Demand for exchange-traded funds in Europe has traditionally come from institutional investors, with retail investors less familiar with the product. But European ETF provider Source is forecasting a significant increase in demand from retail investors as understanding improves. Research conducted by the London-headquartered firm reveals that one in three IFAs expects clients to increase their exposure to ETFs over the next year, compared to one in twenty-five who predict it to fall. “In a poll of more than 100 IFAs in the UK, 14% of them said they do not fully understand ETFs, and 34% said that their clients do not fully understand them,” noted Lee Kranefuss, Chairman of Source.

China played no small role in August’s equity market sell off, but, according to a new report from European ETF provider Source, there are a number of positives to the country that may be being overlooked. “China is now one of the largest economies in the world, and its spending power helped drag the western world out of recession following the financial crisis. This appears to have come at a price, however, and the fallout is being felt not only in China but throughout capital markets worldwide. That said, as we looked more deeply into the data, we discovered that it was not all doom and gloom,” said Paul Jackson, Head of Source’s Multi-Asset Research.

Van Eck Global, the asset management behind the Market Vectors range of exchange-traded funds, has announced plans to close and liquidate four “quality” equity ETFs. Shares in the ETFs will cease trading on NYSE Arca after market close on 18 September 2015 and will subsequently be de-listed. At odds with industry-wide demand for smart beta and income products, the ETFs have failed to attract significant asset flow since their launch in January 2014, with none of the funds managing to sustain more than $5m or so in assets under management.

Following a 21% fall in China’s Shanghai Composite over the past five days and devaluation of the yuan, now could be an opportune time for contrarian investors and/or those with long investment horizons seeking a target allocation to the world’s second-largest economy to begin to progressively build a position in ETFs exposed to the country’s equity and bond markets. The fundamentals, including vast foreign exchange reserves, a healthy current account surplus, moderate fiscal deficit and plenty of capacity for fiscal and monetary stimulus, certainly suggest that over the long term this may prove astute.

Reality Shares Advisors, a US-based niche index provider and ETF issuer, has unveiled a market-strength signalling model, called the “Guardian Indicator”, which aims to identify long-term directional changes in the S&P 500 Index. The model evaluates momentum and volatility indicators to propose either an entry or exit signal to the market. “Markets are subject to extended downturns driven by both fundamental and emotional factors, but Reality Shares’ Guardian Indicator provides a quantitative signal to identify market trends and help to mitigate the impact of price declines,” said Eric Ervin, President and CEO of Reality Shares Advisors.

FTSE Russell, a leading global index provider, has expanded the FTSE Global Factor Index Series to include two additional factors: Momentum and Dividend Yield. The factors are available in developed market and emerging market versions. Peter Gunthorp, Managing Director of Research & Analytics at FTSE Russell, commented: “Asset owners and their consultants are increasingly evaluating and adopting more sophisticated index strategies. As alternatively weighted and factor indices grow in popularity, we will continue to expand our offering to meet this growing demand.”

The multi-asset research team at Source, one of Europe’s largest providers of exchange-traded funds, has published sector research suggesting that US and European bank ETFs present a buying opportunity. Improving economic conditions, a robust housing market and a steepening yield curve are offered as the main driving forces behind their assessment. Paul Jackson, Head of Multi-Asset Research at Source, said: “We remain fully committed to financial on both sides of the Atlantic and we are overweight all subsectors, including banks, financial services, insurance and real estate.”

Listed private equity ETFs have enjoyed a strong year so far, with the Lyxor Privex UCITS ETF (PVX), PowerShares Global Listed Private Equity UCITS ETF (PSSP) and iShares Listed Private Equity UCITS ETF (IPRV) posting returns of 18.0%, 7.1 %, and 7.7% respectively in the period from 1st January 2015 to 23rd July 2015, far exceeding the S&P 500 index’s return of 1.9%. These ETFs invest in a combination of listed private equity asset managers that oversee a collection of funds investing in different forms of private equity, as well as listed private equity funds.

Heavy inflows into currency-hedged ETFs this year and last bear witness to the undeniable popularity of strategies which mitigate currency risk, especially for dollar-referenced investors. According to S&P Dow Jones Indices (S&P DJI), a leading provider of indices, investors are right to be considering currency management and this is particularly pertinent in the near to medium term for USD investors. Aye Soe, Senior Director of Research and Design at S&P DJI, commented: “For a USD investor, currency hedging has long been part of fixed income portfolio management, as currency volatility plays a significant role in international bond returns. However, it is not as prevalent in equity investing. That has been changing as the spreads between hedged international equity portfolios and unhedged international equity portfolios has widened considerably in recent months, and they may widen even more, all else being equal, if other major currencies continue to weaken relative to the US dollar.”

Oil prices have declined recently owing to the ongoing Greek debt crisis and market instability in China. Those investors who correctly predicted the downturn could have earned a handsome return over the last week: the Boost WTI Oil 3x Short Daily ETP (3OIS), an ETP that returns three times the inverse of the Nasdaq Commodity Crude Oil ER Index, gained 43.7%. The new lower price, however, appears to be luring in bargain hunters. ETF securities saw net inflows of $49.3m last week into their long oil products as investors took advantage of lower prices to establish positions in the so-called “black gold”. Investors allocated to a range of primary oil market ETPs, including the ETFS WTI Crude Oil ETF (CRUD), the ETFS Brent 1month ETF (OILB) and the ETFS Energy ETF (AIGE).