WisdomTree

Best Blogs of the Week #267

Posted by Anu Heda on May 11, 2017, in Best Blogs of the Week , tagged with BNY Mellon, SSGA, WisdomTree

A midweek catch-up post detailing three interesting posts (not related to the French election)

BNY Mellon – The Pearl River Delta: the Achilles Heel of US protectionism – In our view, President Trump would need to introduce very stiff tariffs for any of this production to shift to the US, but the majority would probably still remain in China, leading to a rise in the end price instead.

SSgA – ESG Investing: One Size Does Not Fit All – For more benchmark-aware investors, a low carbon target index may be more suitable. For example, the MSCI ACWI Low Carbon Target Index assigns overweight positions to companies with low carbon emissions relative to sales and those with low fossil fuel reserves relative to market capitalization. The idea is to provide a lower-carbon exposure than that of the broad market.

WisdomTree – Stepping Up to BAT: Don’t Count It Out – … described the plan from House Speaker Paul Ryan and Rep. Kevin Brady as a comprehensive way to effectively replace the corporate income tax with a cash flow tax. This is a central feature of the border adjustment tax (BAT). The Ryan-Brady plan reduces rates, allows for immediate expensing of investments and moves to a territorial-based system.

Midweek

Best Blogs of the Week #263

Posted by Anu Heda on Mar 13, 2017, in Best Blogs of the Week , tagged with AB, Van Eck, WisdomTree

Three robust posts from the last two weeks. The quality of charts in asset manager blog posts is dramatically improving as seen in all three posts. I want include the Van Eck and WisdomTree posts not only for the salient point each makes, also to show how product marketing is infiltrating some blogs. It’s an interesting trend occurring at a few of the firms we follow.

AB – Evaluating the Trump Effect on Global Equities – focusing a lens on potential policy outcomes is an increasingly important component for isolating select investment candidates that could deliver solid returns in highly unpredictable times.

Van Eck – Follow the Flows: Active versus Passive – For the three year period ending January 31, 2017, passively managed funds have attracted over $1.4 trillion of new assets according to Morningstar. In that same period, actively managed funds have experienced net outflows of $475 billion.

WisdomTree – An Asset Allocation Study for a Moderate Portfolio – or those willing to alter asset allocations, we believe a continuous improvement in returns per unit of risk could be realized.

robust chart

ETF Issuers and the Missed Education Opportunity

Posted by Anu Heda on Feb 20, 2017, in Thoughts , tagged with BlackRock, SSGA, Vanguard, WisdomTree

In January, Ignites published a piece titled “AQR Second to Vanguard in Active Flows” (subscription required). The primary points orbit active fund flows. What caught my eye was a link to 2016 passive and active fund flows from Morningstar. From their data, only 6% of passive ETF fund flows ($31.5B) went to issuers outside the top five (Vanguard, BlackRock, SSgA, Fidelity, and DFA). That means 120 ETF issuers split $31.5B (issuer list via etfdb). Seems like a massive issuer group sharing a small slice of the ETF flow pie. What types of products do these issuers provide?

To learn more, I sifted through issuer lists and AUM data. Many of the issuers offer leveraged or inverse ETFs (Direxion, ProFunds) while others have thematic ETFs (GlobalX, VelocityShares). To focus my research, I searched for ETFs with investment strategies classified as “alternatives.” Here’s a list of the top 25 alternatives ETFs (image to the right). Only one comes from BlackRock, SSgA, or Vanguard (it’s from SSgA). To support alternative products, issuers need to educate prospective buyers. That’s basic communication strategy. So, I studied the Web sites of the four firms with the 5 largest alternative ETFs: 2 from IndexIQ (now part of New York Life by way of MainStay), WisdomTree, First Trust, and Hull Capital. None of them highlight education on their homepages or product profiles. Rather, they model their sites off of traditional active managers with promotions of thought leadership (2017 Outlook, anyone?), product, and firm.

I think that’s a massive mistake. Focus on education by answering: what’s an alternative ETF? why should you care? how does it precisely fit into an asset allocation plan?

Best Blogs of the Week #254

Posted by Anu Heda on Dec 19, 2016, in Best Blogs of the Week , tagged with BlackRock, WisdomTree

The industry blog flow continues to be brisk as we come towards the end of 2016. Two posts of interest in this week’s review. The first is the best of many posts related to increase of the Fed Funds Rate. The post includes a straightforward analysis showing the impact of (potentially) lower corporate taxes on US public companies’ earnings growth.

BlackRock – The Fed makes its move – At this stage, very low interest rates (especially negative rates) and flat yield curves for long periods of time do little to support growth in the real economy.

WisdomTree – Impact of Potential Tax Reform: Size and Sector Analysis – Small caps—being taxed more predominantly in the U.S. at higher rates than large caps with global earnings—should see a relatively higher increase in earnings from a reduction in U.S. corporate taxes.

via WisdomTree

Best Blogs of the Week (SPECIAL – BREXIT II)

Posted by Anu Heda on Jun 27, 2016, in Best Blogs of the Week , tagged with American Century, BlackRock, Franklin Templeton, Invesco, MandG, MFS, Natixis, PIMCO, TIAA, Wells Fargo, William Blair, WisdomTree

Shocking the capital markets globally, the referendum to leave the EU passed. BREXIT. Asset managers were ready with comment. The proceeding table aggregates industry blog posts on Friday (only). This is an impressive volume (e-mail me if you’re seeking a perspective on quality) though as you see very little thought went to titling these posts. Of the titles below, BlackRock and WisdomTree clearly put thought into their respective titles.

Asset Manager	Blog Post
American Century	Our Views on the Brexit Vote
BlackRock	What data can tell us about the Brexit vote 5 key takeaways from the Brexit vote
Fenimore	Brexit & The value of patience
Franklin Templeton	In The Know: The UK Votes to Leave the EU Brexit: How Quickly May the Surprise Wear Off? A Global Macro View of Brexit Implications
Invesco	UK votes for ‘Brexit’ Beyond Brexit: What happens next?
M & G	Bond market reaction to UK “Leave” vote
MFS	Brexit Rattles the Market
Natixis	Brexit Interviews: Implications of the vote Brexit Vote: The New Unknowns
PIMCO	Brexit: Initial Impact and the Road Ahead Brexit’s Impact on the Eurozone
TIAA	Response to Brexit requires long-term perspective – UPDATED
Wells Fargo	Brexit: Buy the dip, or wait? Brexit vote sends shock waves through markets
William Blair	Brexit Update: Our Base Case Scenario
WisdomTree	Sterling’s Structural vs. Euro’s Political Weakness: “Brexit” Opens Opportunities