ETF Securities, a London-headquartered exchange-traded fund provider, has listed two short and leveraged (S&L) exchange-traded products based on Hong Kong-listed Chinese equities. Commenting on the launch, Massimo Siano, Head of Southern Europe, ETF Securities, said: “We are listing our 3x China Equity ETPs on Borsa Italiana in response to a strong demand from our Italian clients. Investors’ appetite for Chinese equity exposure continues to grow in reaction to heightened volatility and we believe these products provide opportunities to trade on a short-term basis with a competitive total cost of ownership”.

BlackRock, the asset manager behind the iShares brand of exchange-traded funds, has expanded its range of currency-hedged ETFs with the introduction of five smart beta funds based on MSCI indices. Four of the five funds are currency-hedged versions of existing minimum volatility ETFs. These funds offer US dollar-based investors international equity exposure targeted at companies which have historically exhibited relatively low levels of price variation. The fifth fund offers currency-hedged exposure to European small-capitalisation stocks.

WisdomTree has rolled out three new ETFs targeting equity exposure outside the US. The WisdomTree Europe Local Recovery Fund (EZR) invests in European companies which derive more than 50% of their revenue from European customers. The WisdomTree Strong Dollar Emerging Markets Equity Fund (EMSD) is designed to provide exposure to emerging market companies that would benefit from a strengthening dollar. The WisdomTree Global ex-US Hedged Real Estate Fund (HDRW) offers investors the opportunity to participate in the high dividend paying profiles of real estate companies based outside the US, while mitigating exposure to currency movements against the US dollar.

Van Eck Global, the asset management firm behind the Market Vectors range of exchange-traded funds, has announced the launch on the London Stock Exchange of the Market Vectors Morningstar US Wide Moat UCITS ETF (MOAT LN). The engine behind the fund is a proprietary model designed by Morningstar that selects firms considered to possess ‘wide moats’ – a significant structural competitive advantage that has the potential to provide long-term above-average returns. The term ‘economic moat’ was coined by Warren Buffett and can refer to brand loyalty, cost advantages, economies of scale, or regulatory protection, among others, as potential avenues whereby firms establish a strong market position.

Commerzbank, the German bank behind the ComStage range of exchange-traded funds, has announced the launch of a family of investable indices based on fund flow data from EPFR, a leading fund flow and asset allocation provider. Covering multiple asset classes including equities, commodities, fixed income and multi-asset, the indices track systematic strategies that utilise the predictive power of fund flow data to make asset allocation decisions. Their systematic nature means they can also be used as the basis for index-linked products such as exchange-traded funds.

The benefits of exchange-traded funds over the traditional mutual fund structure have driven the growth of these investment products over past decades. As adoption increases investors must be aware of the true cost of ETF investing. To facilitate this experts from Pershing and BNY Mellon have delivered a white paper outlining what investors need to assess when buying an ETF. “It is important for advisors to be as well informed as possible about the apparent and underlying factors that influence the cost of their ownership,” said Justin Fay, vice president and solutions manager for alternative investments and ETFs at Pershing.

Due to the rapid expansion of the Shariah financial industry over the past 30 years, providers are increasingly looking to develop more sophisticated solutions aimed at Islamic investors. The development of the S&P Pan Arab Composite Shariah Dividend Index marks another step in the maturing of these markets. “The new indices represent an important expansion of the S&P Pan Arab Indices as the region seeks more specialized indices. The Pan Arab market is dynamic and growing, and S&P Dow Jones Indices will continue to bring innovative indices to cater to the region’s needs,” said Alka Banerjee, Managing Director, Global Equity Indices, S&P Dow Jones Indices.

Etho Capital, the US-based sustainable investment manager, has launched the Etho Climate Leadership Index (ECLI), a diversified index that is divested from fossil fuels and focused on climate efficiency in other industries. The company plans to launch an exchange-traded fund based on US equities in the index later in 2015. The inclusion of an ESG screen in the index methodology looks to favour companies who operate sustainably. “Companies with efficient supply chains and management teams that plan for the long run are likely to do better in our changing climate,” said Conor Platt, Co-Founder, Chief Executive Officer and Chief Investment Officer of Etho Capital.

WisdomTree, the exchange-traded fund provider behind the Boost ETP product range, has released a report tracking the global asset flows into short and leveraged (S&L) products. “September was a strong month for short & leveraged ETPs as investors took advantage of heightened volatility to position opportunistically or hedge their exposures,” said Viktor Nossek, Director of Research for WisdomTree Europe. “Of particular note were the inflows of over $3.7bn into S&L ETPs tracking US, Japanese and European equities last month.”

A review of exchange-traded fund activity by BNY Mellon, the global financial services provider, indicates that ETF issuers are favouring the launch of alternatives- and derivatives-based funds this year. “Growing interest from registered investment advisors looking for downside protection appears to be an important driver of the growth of alternatives-based ETFs,” said Steve Cook, business executive, structured product services at BNY Mellon. “In addition the possibility of rising interest rates has advisors looking for alternatives to fixed income investments. The structure and tax efficiencies of ETFs enhance the attractiveness of this type of investment.”