Latest news with #ETFStream
Finextra
13 hours ago
- Business
- Finextra
TMX VettaFi acquires ETF Stream
TMX VettaFi, an indexing, digital distribution, analytics and thought leadership company and TMX Group subsidiary, announced today the acquisition of ETF Stream Limited (ETF Stream), a leading media brand for ETFs in Europe. 0 "The acquisition of ETF Stream represents an important step forward in our strategy to expand TMX VettaFi's digital and analytics capabilities in the U.K. and Europe," said Tom Hendrickson, President, TMX VettaFi. "Moving forward, we remain focused on opportunities to build on our offerings and expertise to strengthen our value proposition, and better serve a growing international network of clients and partners.' ETF Stream provides content to industry participants through its website, publications and events. The team of journalists cover the latest news, provide expert analysis and share informed opinions on a range of issues across the ETF ecosystem. ETF Stream also educates investors and advisors through events, guides, features, analysis and data tools. 'We're excited to join the TMX VettaFi family,' added Sam Ridley, Managing Director, ETF Stream. 'The combination of TMX VettaFi's resources and reach, with a shared belief in fostering innovation, will accelerate our ability to deliver value and premium products to our readers, clients and the European ETF industry.' This marks the fifth acquisition by TMX VettaFi in the last few years, following the acquisitions of the Credit Suisse Bond Indices from UBS in February 2025; iNDEX Research in October 2024, an end-to-end index provider across equity and fixed income exposures; the ROBO Global Index Suite in April 2023; and EQM Indexes in September 2023.
Yahoo
29-05-2025
- Business
- Yahoo
How Indexing Is Driving the Erosion of the Small-Cap Premium
The small-cap premium is 'very likely dead,' and the forces that once drove it are 'either gone or overwhelmed,' according to Joachim Klement, head of strategy at Panmure Liberum. Speaking at ETF Stream's 2025 ETF Ecosystem Unwrapped event, Klement argued that the rise of index investing 'has created a self-reinforcing loop where the largest stocks get ever larger, and the small-cap premium erodes—perhaps permanently.' The small-cap premium concerns the historical tendency for small-cap stocks to outperform large ones over time. But as ETF Stream explored last year, the phenomenon has been weak since the 1980s and particularly so in the last decade. For Klement, the timing of its disappearance is no coincidence: It went hand-in-hand with the rise of benchmarking and index investing. This change in approach from the investment community has created an environment whereby small-caps exhibit lower elasticity of demand than large-caps—an observation also made by Simplify Asset Management's Mike Green in his recent interview with ETF Stream. Essentially, benchmarked investors are forced to hold the largest stocks in size or risk too large a tracking error. 'Trust me, no risk team likes that,' joked Klement. Given their lower elasticity, every marginal dollar into the stock market forces the price of large-caps up by a relatively greater degree, creating that 'self-reinforcing' cycle of size begets size, something Green argued makes the market vulnerable to a steep market crash. As further evidence, Klement highlighted a study which showed that stocks with high "index inclusion ratios"—in other words, those which are members of many indices such, as the Magnificent Seven—substantially outperformed companies with low inclusion ratios, a phenomenon that 'exploded' in the 2010s, as the below chart shows. Chart 1: The Index Inclusion Effect, 2000-2021—Source: Behmaram (2023) Index inclusion 'creates more automatic buying—independent of valuation—pushing prices higher. It's artificial demand,' Klement explained. 'The study even modeled a counterfactual: What if there had been no flows into index funds and ETFs over the last 25 years? The outperformance of high-index-inclusion stocks disappears,' he added. Despite the evaporation of the small-cap premium, Klement believes they still serve an important role in a diversified portfolio. For one, they tend to outperform coming out of recessions because they are 'more agile and quicker to adapt to changing conditions ... this cyclical behaviour offers diversification benefits and, for active allocators, opportunities to adjust exposure over time.' Second, 'Structural changes have suppressed small-cap valuations—especially in markets like the U.K., where regulatory shifts such as MiFID II have reduced liquidity.' With many asset allocators rotating away from the U.S. towards Europe and the U.K., 'Even a modest reallocation into small-caps could significantly move prices,' he said. This article was originally published at sister publication ETF | © Copyright 2025 All rights reserved Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
27-05-2025
- Business
- Yahoo
Invesco Launches New Active Global Equity ETF in Europe
Invesco has launched a systematic active ETF aiming to outperform global equities but with similar risk-reward characteristics to the benchmark, according to sister publication ETF Stream. The Invesco Global Enhanced Equity UCITS ETF (IQGA) debuts with a total expense ratio of 0.24% and is listed on Deutsche Boerse, Euronext Milan and the London Stock Exchange. The strategy, run by the Invesco Quantitative Strategies (IQS) team, has been in existence since 2005 and targets 1% outperformance per year versus the MSCI World Index with a tracking error in the 1%-1.5% region. It uses a proprietary model to identify attractive investments within the global large- and mid-cap equity universe before an optimization process finds the optimal trade-off between risk considerations, transaction costs and the portfolio's exposure to value, quality and momentum factors. Erhard Radatz, global head of portfolio management at Invesco Solutions, said, 'Our philosophy is based on an expectation that cheap will outperform expensive, trends will persist for a while and high quality will beat low quality." 'Results since the launch of the strategy 20 years ago seem to support this,' he added. Meanwhile, Gary Buxton (pictured), head of EMEA and APAC ETFs at Invesco, said the new ETF is 'a great example of an active approach that fits seamlessly into our efficient ETF structure." 'An ETF following such a repeatable, systematic process is a natural extension to the rules-based, beta and smart beta ETFs currently available,' he noted. Invesco joins a host of other issuers including HSBC, Schroders, Goldman Sachs and BNP Paribas that have recently or are about to launch low-tracking-error active ETFs. This article was originally published at sister publication ETF | © Copyright 2025 All rights reserved Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
06-05-2025
- Business
- Yahoo
US Semi-Transparent ETF Players Plot New Expansion in Europe
U.S. semi-transparent ETF model providers Precidian and Blue Tractor are positioning for business in Europe after both the Central Bank of Ireland (CBI) and Luxembourg regulator (CSSF) relaxed their respective stances on transparency. In the U.S., asset managers looking to deliver their investment strategies via an ETF without daily disclosure of full portfolio holdings must use one of the prescriptive models to have already received regulatory approval or develop their own. Players such as Precidian, Blue Tractor and the New York Stock Exchange—the latter in conjunction with Natixis—have developed semi-transparent ETF templates that they license to interested managers. ETF Stream understands that Precidian is working towards a new structure that is acceptable for regulators on both sides of the Atlantic. Semi-Transparent ETF Templates Its U.S. ActiveShares model uses trusted agents, or Authorised Participant Representatives (APRs), to execute creations and redemptions. This is unlikely to satisfy the CBI and CSSF's requirements for disclosures to be made to liquidity providers in a "non-discriminatory" manner. In Blue Tractor's Shielded Alpha model, the portfolio's constituents are disclosed, but published weightings deviate from actual weightings in a randomised fashion by up to 20%. A spokesperson for the firm told ETF Stream that it believes it 'has a place to play in the marketplace in Europe.' The New York Stock Exchange did not respond to a request for comment. Fidelity and Eaton Vance, the latter a subsidiary of Morgan Stanley Investment Management, opted instead to rollout semi-transparent ETFs using internally developed structures. As to whether either is looking at Europe, Fidelity did not respond to a request for comment, while Morgan Stanley declined to comment. Since the first semi-transparent ETF launched in 2020, uptake from asset managers has been circumspect. Just 51 ETFs currently make use of reduced transparency rules in the U.S. according to figures from ETFGI, a data consultancy. T. Rowe Price and American Century are among the bigger names to offer strategies in semi-transparent form. A spokesperson from American Century told ETF Stream, 'While we are pleased to see the expanding regulatory support for actively managed ETFs across Ireland and Luxembourg and the opportunities that these changes may offer in the future, the near-term focus for our UCITS ETFs will be on strategies managed by Avantis Investors.' T. Rowe Price said it has 'nothing planned at present' in Europe. Reduced Transparency, Limited Demand Since coming to market in 2020, ETFs with reduced transparency have struggled to attract widespread demand - in part because they are limited to investing only in U.S. securities.
Yahoo
11-03-2025
- Business
- Yahoo
Morgan Stanley Sees Opportunity in the European ETF Market
Morgan Stanley Investment Management (MSIM) is exploring an entry into the rapidly growing European ETF market with its own in-house strategies, ETF Stream understands. MSIM, the asset management arm of Morgan Stanley, laid the foundation for an expansion into European ETFs in October 2024 when it registered the Morgan Stanley ETF ICAV with the Central Bank of Ireland (CBI). The first ETF to launch via the platform will be the Garnet US Treasury Bond 1-3 Year UCITS ETF (GUS1), a short-dated U.S. government bond fund that received the regulator's green light in February. According to a person familiar with the matter, GUS1 will launch in response to targeted client demand and is not part of the broader range of in-house strategies the firm is considering bringing to the European market. MSIM entered the US market in January 2023, and its 17-strong U.S. ETF range houses $4.8 billion in assets under management, according to data from Trackinsight. The suite encompasses fixed income, equity and option-based ETFs—all managed by subsidiaries Calvert, Parametric and Eaton Vance. The firm has contemplated entering Europe's ETF market on a number of occasions over the last two decades, but to-date, it has not used the ETF wrapper to deliver its own strategies. Deborah Fuhr, founder of ETFGI and former head of investment strategies at Morgan Stanley, previously said the firm was within touching distance of launching Europe's first ETFs in the year 2000. 'If Morgan Stanley had entered the ETF industry when I was still working there—when they were thinking about it back in 2000—with a family of real ETFs, we would have been the largest manager of ETFs in Europe,' Fuhr told ETF Stream. 'We had a set of ETFs ready to go, a marketing campaign and regional products, which would have launched in the first round. We even had these little cardboard single-use cameras to give away, with 'instant exposure in a single clip' as a campaign tag.' However, a number of UCITS ETFs have come to market via the firm's FundLogic platform—part of MSIM but distinct from its in-house products—including six smart beta ETFs, which closed last year, and a recently launched covered call strategy issued by Montrose, a subsidiary of Swedish financial services group Carnegie. The Montrose Global Monthly Dividend MSCI World UCITS ETF (MONTDIV) is listed on the Stockholm Stock Exchange and Morgan Stanley serves as a market maker for the product, ETF Stream understands. A second Montrose ETF is expected to launch via the FundLogic platform as early as this month. After the launch of MSIM's first six ETFs in the US, the firm's global head of ETFs, Anthony Rochte, said: 'We are in the initial steps of building out a global ETF platform. There is client demand for both mutual funds and demand for ETFs. We are going to where our clients are.' Morgan Stanley declined to comment for this article. This article was originally published at sister publication ETF | © Copyright 2025 All rights reserved
