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BlackRock's ‘Widow Maker' ETF Is Suddenly in High Demand
BlackRock's ‘Widow Maker' ETF Is Suddenly in High Demand

Yahoo

time6 days ago

  • Business
  • Yahoo

BlackRock's ‘Widow Maker' ETF Is Suddenly in High Demand

With a nickname like 'widow maker,' you'd think investors would stay away. The iShares 20+ Year Treasury Bond ETF (TLT), which got its moniker because of its recent poor performance — took in $1.3 billion assets in the past week, according to CFRA Research. Since long-term Treasury bonds are more susceptible to the effects of interest rate changes as they mature, short or intermediate bonds are often more appealing. And for TLT, if investors bought the fund five years ago, they would have lost some 45% of their original assets, according to the Financial Times. But, it looks like long-term products are increasingly on the menu. 'TLT is often used by investors to buy the dip when they think [Fed interest] rates have peaked,' said Aniket Ullal, head of ETF Research & Analytics at CFRA. 'We may be seeing similar behavior here since inflation numbers have been fairly benign recently.' READ ALSO: Nasdaq Wants to Wrap This $11.5B Altcoin in an ETF and Vanguard's 2 New Muni ETFs Have an Advantage Over Mutual Funds The bond market had a small win last week as both 20-year and 30-year Treasury yields began trading just below 5%, the first time since May 20. And while President Donald Trump doesn't have the authority to lower interest rates, he's made his position well known, recently telling Fed Chair Jerome Powell he's making a 'mistake' by not lowering them. Plus, who could forget all that volatility? All this could be contributing to TLT's momentum. 'Investors in long-term Treasury bond ETFs like TLT will win if the US economy weakens significantly and investors believe the Fed will need to cut rates aggressively,' said Todd Rosenbluth, head of research at VettaFi. However, he noted that TLT doesn't have the strongest track record, and taking on significant duration risk has not been rewarding for investors: Over the past five years, the fund has taken in roughly $50 billion in inflows, per VettaFi data. But, its performance is down nearly 50% in that same time. 'Timing this trade can be very difficult,' Ullal told Advisor Upside. This post first appeared on The Daily Upside. To receive exclusive news and analysis of the rapidly evolving ETF landscape, built for advisors and capital allocators, subscribe to our free ETF Upside newsletter. 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

How AI is reshaping real estate
How AI is reshaping real estate

Yahoo

time26-05-2025

  • Business
  • Yahoo

How AI is reshaping real estate

Artificial intelligence, or AI, has the potential to shake up a lot of industries. In the video above, VettaFi senior research analyst Zeno Mercer joins Asking for a Trend with Josh Lipton to explain how AI could reshape the real estate sector. To watch more expert insights and analysis on the latest market action, check out more Asking for a Trend here. And basically, you know, you're walking people and your clients with this idea that AI and robotics, they're transforming the real estate industry. It's driving what you say is this, this real transformative evolution of the of the industry. Walk us through it just high level. What do you mean by that? Yeah, so AI robotics are, you know, traditionally, I mean robotics has been traditionally people think of it as manufacturing and logistics, but it's gonna be a lot more than that. It already starting to be AI we already. You know, can drive efficiencies and and connect the dots and improve, um, you know, efficiency gains in a lot of places but high level if you break down, um, like real estate, the use of real estate and the use of really anything in the world you're you're making things, you're moving things, you're manipulating things or you're storing things that's majority of GDP fits into that bucket with real estate, um, if you, if you think about it. AI and robotics is going to transform the entire life cycle of real estate, so you've got the design. So how are you building things? Where are you building things and so there's a couple of considerations there. So you're gonna have AI robotics used uh in housing in mobility and transportation. You're gonna see, you know, things like parking lots turn in the parks as you see less need because we have autonomous vehicles that don't need the park. So there's a design element where A robotics will or artificial intelligence will redesign how we're thinking about designing. So companies like Autodesk, players like that will will have a huge play into um. Just like that, that system of designing and there's also the materials and energy designs that are gonna come into play. So if we think about um you know, we run on energy, uh, the most advanced economies have higher utilisation of energy and so that's a big component of that is the energy efficiency. So now we're moving on to once we built or we have to design it, then we build it. Right now robots have pretty low penetration that actually build things. It's still very physically manual labour intensive. You do have some fab construction where like they premake it and there's some 3D printing things, but on job sites it's still very manual and there's a lot of room, there's a lot of need to improve the efficiency. Here we have labour shortages and we we have unmet needs we have uh housing crisis. I mean people can't afford to live here or uh operating system really isn't functioning we have a lot of debt like we can't really operate the way we're going so we actually need to use more AI robotics to improve that side of things. Next stage is actually operations so. AI will become the operating system of buildings and so that's uh energy efficiency that's improving the quality of life. Think about the ageing population a lot of them get sent to nursing homes, but like in reality it's like why can't more people live at home? So if you start to add AI you have more energy efficiency you have, you know. More robots that can accomplish more goals that actually fundamentally shifts where people will be thinking about development of real estate because that will change people's lives and so that also goes into like data centres and other things that energy management component is very, very important when you, when you think about the real estate industry though, you know, I mean it can be it can be. A highly regulated industry and sector does that pose any kind of challenges or obstacles to deploying and integrating this kind of next gen tech you're talking about? It's a huge opportunity because right now let's back up to like Doge, OK? I think we brought up Doge on the show before, but in this case. We're not trying to move fast and break things. We're trying to move fast and make things, and if we're doing that, AI can actually improve how we're validating and and reduce the red tape speed like the the the cycle. So you know, permits take too long. There's a lot of like opinions and local governments that are kind of getting in the way and stopping kind of NIMBY versus YIB. And so you know AI can also be used on the flip side of the governance side of saying like why do we have these regulations? Is this for safety, energy efficiency and codify that and so now these codes are. Uh, you know, these laws can be codified and made easier so we'll see faster uptick and reduce costs and so developers will say like, oh, I'm more likely to be able to get this through the door faster. Here are the incentives this is what I need to do so you can actually see improvements from that. But yeah, I mean people will talk about energy consumption, um, and there are a lot of players that are trying to reduce that, um, and make you know more efficient energy efficient buildings so that that should be a net positive. I don't think anyone's gonna be against that.

Investors pile into ETFs at record pace despite market turmoil
Investors pile into ETFs at record pace despite market turmoil

Mint

time26-05-2025

  • Business
  • Mint

Investors pile into ETFs at record pace despite market turmoil

This year's volatile, trade war-obsessed market didn't shake American investors' fondness for exchange-traded funds. In fact, it only made them love them more. Investors have plowed a record $437 billion into U.S. ETFs so far this year, unfazed by the wildest markets since Covid. And if inflows maintain the current pace—historically, they accelerate in the summer and fall months—it will mark the second straight record year for U.S. ETF flows. That is happening in part because of the relentless flow of money out of mutual funds and into ETFs, which tend to offer lower fees and certain tax advantages that their older cousins can't match. But the decadelong trend doesn't fully explain this year's surge; indeed, when U.S. markets turned choppy, many began to double down on their bets on U.S. assets. And, now more than ever, they placed those wagers by buying ETFs. 'Investors are seeing selloffs as buying opportunities," said Todd Rosenbluth, head of research at data provider VettaFi. The hundreds of billions of dollars that investors poured into ETFs found their way into every major fund category: Stock funds and bond funds. Funds that track popular indexes continue to sell well, but so have those managed by professional stock and bond pickers, a relatively new corner of the ETF market that has gained momentum. No one fund benefited more from the surge than the ETF industry's new champ: Vanguard Group's S&P 500 ETF. The ultracheap index fund has soaked up a stunning $65 billion in net inflows this year, along the way becoming the world's biggest ETF by assets. Known by ticker symbol VOO, the fund more than doubled the previous annual ETF inflow record when it took in $116 billion last year. Now it is on pace to reset that mark again by October. VOO's rise illustrates how investors more broadly turned to ETFs this year. When stock-market volatility soared to a five-year high in April, Vanguard's S&P 500 fund reported its highest monthly inflows ever. Many investors had built up large cash holdings by then, and had been waiting for the right moment to shift money back into stocks, according to Greg Davis, president and chief investment officer at Vanguard. 'During that period of tumult in early April, we saw a 5-to-1 buy-to-sell ratio," Davis said. 'Investors have a tremendous amount of cash sitting on the sidelines and they know that if things are on sale, it is time to put money to work." Swelling ETF assets have been a windfall for Vanguard and BlackRock, the two largest U.S. fund managers. BlackRock Chief Executive Larry Fink has talked repeatedly about the opportunity for his firm to capitalize on a reallocation from cash to stock and bond funds. 'In the United States, there's $11 trillion sitting in money-market funds," Fink said at the Saudi-U. S. investment forum in Riyadh earlier this month. 'When there is uncertainty, you're going to keep more money in cash and that is what we witnessed." Several years after the Federal Reserve began lifting interest rates to combat inflation, the allure of cash is still strong for many investors. The second-most popular ETF this year has been a BlackRock 0-3 month Treasury bond fund, which has almost $17 billion in inflows. The cashlike fund has a 12-month trailing yield of 4.7%. A similar offering from State Street is also in the top 10 of the flows leaderboard. 'We are seeing some defensiveness on the fixed-income side," said VettaFi's Rosenbluth. 'With several short-term Treasury products in the top 10, that's a sign investors are happy being paid to wait." Still, equity funds have taken in a majority of this year's flows. Joining VOO in the top 10 are State Street's S&P 500 fund, Vanguard's total stock-market and equity growth funds, and two Nasdaq-100 funds from Invesco. An actively managed equity fund from JPMorgan that aims to reduce volatility and produce above-average dividend income through an options strategy also cracked the top 10. Part of a broader class of active funds that some analysts have dubbed 'boomer candy" thanks to their popularity with retirees, the JPMorgan fund is building on a breakout 2024. Actively managed funds continue to capture an outsize share of new assets. According to Trackinsight, 30% of this year's ETF flows have gone to active funds even though they make up less than 10% of the industry's total assets. Longtime mutual-fund giant Fidelity has been focusing on active ETF launches in recent years, and interest continues to grow, said Greg Friedman, Fidelity's head of ETF management and strategy. 'For the last 12 to 24 months, we've been seeing a very nice level of inflows with most of it on the active side," Friedman said. 'That has held up even during extreme volatility." For years, investors have been swapping their mutual funds for the tax benefits and liquidity offered by ETFs, boosting inflows. That trend could soon accelerate even further. Dozens of fund managers have filed applications with the Securities and Exchange Commission to offer new ETF share classes of existing mutual funds, which would allow them to offer popular strategies in the ETF wrapper without starting from scratch. SEC Commissioner Mark Uyeda said earlier this year he has told the agency's staff to give priority to the issue, and many in the industry are expecting approval as soon as this year. Write to Jack Pitcher at

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