Defensive ETFs flourish through volatile January
Defensive exchange traded funds (ETFs) are minimising the impact of market volatility, as investors look for alternative opportunities, robo-advice provider, Stockspot believes.
In its February ETF update, Stockspot reported that January 2016 saw volatility and share market falls across the globe which led to the first negative month of ETF funds under management (FUM) growth since August 2015 (falling four per cent), while the commodities sector had the highest monthly increase in FUM largely due to a 10 per cent rise in the gold price.
"Inflows into the fixed income and cash sector also highlights risk aversion during January," the report said.
"BetaShares' Australian High Interest Cash ETF (AAA) added $50M of new FUM.
"Other Australian bond ETFs, including IAF, RSM and VAF also received over $10M of new FUM each during January."
While there were declines in FUM at the very top end of the ETF market, ETF Securities, saw a 10 per cent surge in FUM, despite the market volatility, UBS suffered the biggest percentage hit to its FUM, dropping 26 per cent
Recommended for you
Almost 70 per cent of asset managers are planning to control costs via product rationalisation, according to a global survey by Northern Trust, as they seek to offer clients a best-in-class experience.
Fund managers should work collaboratively with data providers to minimise greenwashing risks in their products as a positive ESG score can be a “gamechanger” for a fund’s demand with advisers.
Asset manager Janus Henderson has made two acquisitions in the ETFs and emerging markets space as it takes strategic steps to meet client needs.
Self-reporting issues to ASIC could lead to a reduced charge for a fund manager but it may not exempt them from enforcement action altogether, according to ASIC chair Joe Longo.
