Latest news with #PatturajaMurugaboopathy
Yahoo
5 days ago
- Business
- Yahoo
Global investors flock to ex-US markets for better growth, valuations
By Patturaja Murugaboopathy (Reuters) -Global ex-U.S. equity funds received their biggest inflows in more than four-and-a-half years in July, as investors redirected capital away from the United States on concerns over the economy, stretched stock values, and a weakening dollar. These funds began seeing inflows earlier this year as President Donald Trump's economic policies hurt the appeal of U.S. markets. But the steep gains in July suggest a sustained shift towards diversification, particularly into Europe and emerging markets benefitting from easier monetary conditions and improved growth prospects. According to LSEG Lipper, global ex-U.S. equity funds secured an inflow of $13.6 billion in July, the highest since December 2021. In contrast, U.S.-focused equity funds saw $6.3 billion in outflows, marking their third straight month of redemptions. "While tariff de-escalation was a tailwind in the second quarter, unresolved trade negotiations and policy deadlines approaching in the early third quarter pose ongoing risks," Shelton Capital Management Chief Investment Officer Derek Izuel said. "Persistent uncertainty could reignite flows out of U.S. equities, particularly if growth differentials continue to narrow or the Federal Reserve maintains restrictive monetary policy." The divergence in performance has been another key driver of outflows from U.S. equities, with the MSCI Asia Pacific ex-Japan index up around 14% and the MSCI Europe index gaining more than 19% this year, outpacing the S&P 500's 7.2% rise. Furthermore, the dollar has declined about 10% this year, amplifying returns for U.S. investors from international markets. Jim Smigiel, chief Investment Officer at SEI, said that while global diversification remains a key focus, it is too soon to tell if recent flows mark a sustained shift. "We see this recent trend as more of a strategic rebalancing to neutral positioning from a geographic perspective and less of an adoption of any underweight to the U.S.," he said. The forward 12-month price-to-earnings ratio of the MSCI U.S. index stood at 22.6, much higher than MSCI Asia's 14.4, MSCI Europe's 14.2 and MSCI World's 19.7. (Reporting By Patturaja Murugaboopathy; Editing by Vidya Ranganathan and Rashmi Aich) 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
29-07-2025
- Business
- Yahoo
U.S. covered call funds attract record inflows as investors seek yield
By Patturaja Murugaboopathy (Reuters) -U.S. covered call funds are drawing robust inflows this year as investors search for higher returns and protection from broader market volatility because of continued tariff risks and geopolitical tensions. According to Morningstar data, U.S. derivative income funds, primarily made up of covered call strategies, attracted a record $31.5 billion in the first half of this year. Till the middle of this month, they secured another $2.5 billion, lifting the total net assets to a record $145 billion, the data showed. Covered call funds generate income by owning stocks and selling call options on them, collecting premiums in return. In choppy markets, like the current one clouded by macroeconomic uncertainty, these options often expire unused, allowing the fund to retain the premium as stock prices typically don't rise enough to trigger a sale. While gains are capped if markets rise sharply, the consistent income stream remains appealing. The JPMorgan Equity Premium Income ETF has offered a 12-month trailing yield of 8.25%, while the JPMorgan Nasdaq Equity Premium Income ETF and the Global X Nasdaq 100 Covered Call ETF yielded 11.5% and 13.9%, respectively, well above the 10-year U.S. Treasury yield of 4.4%. Chad Harmer, founder and chief investment officer of Harmer Wealth Management, said covered call funds have also become more accessible through low-fee ETFs and 401(k) plans. A 401(k) is a U.S. workplace retirement plan that lets individuals invest pre-tax income and continue managing those assets into retirement. The biggest demand is coming from retirees and conservative allocators, as these funds on average pay more than bonds and rise on concerns that broader equity markets may struggle to keep recent gains. "We believe that the substantial rally in recent weeks has already priced in a lot of potential good news, and that investors should prepare for potential market volatility in the weeks ahead,' said Mark Haefele, chief investment officer at UBS Global Wealth Management. Barry Martin, portfolio manager at Shelton Capital Management, said investors are embracing covered call funds not just for cash flow generation, but also to manage portfolio volatility. "It's a powerful shift in how we approach yield and risk management. This year, with the increased volatility, it is especially a good market to sell calls in." (Reporting By Patturaja Murugaboopathy in Bengaluru; editing by Shankar Ramakrishnan and Jan Harvey) 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
14-07-2025
- Business
- Yahoo
Bitcoin rally driven more by institutional demand than speculation
By Patturaja Murugaboopathy (Reuters) -As bitcoin hit a record high on Monday, evidence from institutional flows and derivatives suggested its rally might be more stable and lasting than previous speculative runs. Bitcoin crossed $120,000 for the first time on optimism over upcoming U.S. House discussions on digital asset regulation, extending its gains this year to about 30%. The rise has been fuelled by strong flows into bitcoin exchange-traded funds (ETFs) and rising corporate treasury allocations. Analysts said bitcoin's surge is driven this time by institutional flows and reflects its evolution into a more stable asset, sought after as investors seek diversification from market volatility and a wobbly U.S. dollar. Institutional inflows tend to be longer-term and less prone to rapid reversal, lending greater stability and durability to the current rally. Bitcoin ETFs have made a strong start to July, attracting $3.4 billion in inflows so far. That includes a record $2.2 billion over the past two days, the largest two-day net inflow on record, according to data from Farside Investors. At the same time, open interest in bitcoin futures rose to a record $57.4 billion as of Friday, data from CoinDesk shows. Open interest tracks the total value of outstanding futures contracts, and a sustained rise often points to greater institutional involvement, as larger investors tend to hold bigger, longer-term positions and use futures for hedging. Yet, funding rates in the futures market remain subdued. According to CoinDesk, the annualised funding rate stood at 10%, well below the 80% peaks of 2023 and 40% at the end of last year. The funding rate reflects the cost traders pay to keep bullish, leveraged bets open in the futures market. A decline signals they're less willing to pay to stay in those positions — a sign of reduced speculative demand. Glassnode data shows bitcoin's estimated leverage ratio has declined to 0.25, down from 0.32 at the start of 2025. The leverage ratio compares how large traders' futures bets are relative to the amount of bitcoin on exchanges. A lower ratio means those bets are backed by more real capital and less borrowed money. Glassnode data also showed an increase in short liquidations as traders betting against bitcoin bought back the token as prices rose, adding momentum to the rally. (Reporting By Patturaja Murugaboopathy in BengaluruEditing by Vidya Ranganathan and Jane Merriman)
Yahoo
14-07-2025
- Business
- Yahoo
Bitcoin rally driven more by institutional demand than speculation
By Patturaja Murugaboopathy (Reuters) -As bitcoin hit a record high on Monday, evidence from institutional flows and derivatives suggested its rally might be more stable and lasting than previous speculative runs. Bitcoin crossed $120,000 for the first time on optimism over upcoming U.S. House discussions on digital asset regulation, extending its gains this year to about 30%. The rise has been fuelled by strong flows into bitcoin exchange-traded funds (ETFs) and rising corporate treasury allocations. Analysts said bitcoin's surge is driven this time by institutional flows and reflects its evolution into a more stable asset, sought after as investors seek diversification from market volatility and a wobbly U.S. dollar. Institutional inflows tend to be longer-term and less prone to rapid reversal, lending greater stability and durability to the current rally. Bitcoin ETFs have made a strong start to July, attracting $3.4 billion in inflows so far. That includes a record $2.2 billion over the past two days, the largest two-day net inflow on record, according to data from Farside Investors. At the same time, open interest in bitcoin futures rose to a record $57.4 billion as of Friday, data from CoinDesk shows. Open interest tracks the total value of outstanding futures contracts, and a sustained rise often points to greater institutional involvement, as larger investors tend to hold bigger, longer-term positions and use futures for hedging. Yet, funding rates in the futures market remain subdued. According to CoinDesk, the annualised funding rate stood at 10%, well below the 80% peaks of 2023 and 40% at the end of last year. The funding rate reflects the cost traders pay to keep bullish, leveraged bets open in the futures market. A decline signals they're less willing to pay to stay in those positions — a sign of reduced speculative demand. Glassnode data shows bitcoin's estimated leverage ratio has declined to 0.25, down from 0.32 at the start of 2025. The leverage ratio compares how large traders' futures bets are relative to the amount of bitcoin on exchanges. A lower ratio means those bets are backed by more real capital and less borrowed money. Glassnode data also showed an increase in short liquidations as traders betting against bitcoin bought back the token as prices rose, adding momentum to the rally. (Reporting By Patturaja Murugaboopathy in BengaluruEditing by Vidya Ranganathan and Jane Merriman)
Mint
25-06-2025
- Business
- Mint
Investors returned to US long-term bond funds in May
By Patturaja Murugaboopathy June 25 - U.S. long-term bond funds drew massive inflows in May, reversing April's drawdown and indicating investors sought the safety of higher-yielding debt, as they weighed a host of uncertainties around trade tariffs, inflation and fiscal deficits. According to Morningstar data, U.S. long-term bond funds attracted $7.4 billion in May, their largest monthly inflow in over two years, after facing sharp outflows in April. Jeana Doubell, fixed income analyst at Morningstar, said inflows into long-term bond funds in May reflect investor expectations of weaker growth and a view that bonds offered better value than other riskier assets. U.S. long-term bonds were sold off heavily in April on concerns that U.S. tariff measures could fuel inflation, while expectations that President Donald Trump's tax bill could inflate the deficit and Treasury supply added to the pressure. However, analysts said those concerns have eased as trade talks progress, rekindling appetite for long-term bonds. "Long-bond prices are susceptible to inflation, and recent data shows very little inflation above the Fed's 2% target," said Chris Gunster, head of fixed income at Fidelis Capital Partners. "As long as inflation is less of a concern, then long-dated Treasuries should reassert themselves as a hedge against equities and other risk asset declines." "The smart investors should already be locking in longer-term rates," he said. The Morningstar data showed short-term bond funds saw $5.8 billion in outflows after strong inflows the previous month, while intermediate-term bond funds attracted $4.2 billion. iShares 20 Year Treasury Bond ETF led with inflows of $4.3 billion, while iShares 10-20 Year Treasury Bond ETF and iShares 7-10 Year Treasury Bond ETF received $1.2 billion and $625 million, respectively. This article was generated from an automated news agency feed without modifications to text.
