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ETFs: Is Window For Currency Hedge Closed?

Posted on 16 April 2015 by VRS  |  Email |Print

Last year the ETF industry launched 10 currency-hedged exchanged traded funds, doubling the total number available, in time to maximize their potential against the falling yen and the euro. But some are now beginning to wonder if the strategy these ETFs follow has hit its sell-by date and the currency hedge is no longer needed.
“When the euro cost $1.40, no one believed that Europe would do a quantitative easing,” said Brent Schutte, senior investment strategist at Chicago’s BMO Global Asset Management, which has $271 billion under management. ……………………………………….Full Article: Source

Low costs and liquidity lure investors to ETFs

Posted on 16 April 2015 by VRS  |  Email |Print

Investors and their advisers have been turning to exchange-traded funds over recent years thanks to their low-cost nature, Rachel Lord has claimed. The head of Europe, the Middle East and Africa for iShares – part of asset manager BlackRock – said that as the product gained more traction in the UK, it would not be long before the European ETF industry, including the UK, hit its milestone of £680bn (US$1trn) of assets under management.
Reasons for its growing popularity among investors, she said, included product innovation, more confidence in the market and the cost-effective nature of ETFs, which tend to have lower total expense ratios than actively managed funds………………………………………..Full Article: Source

Look out OPEC! Oil ETF investors head for exit, risking new slump

Posted on 15 April 2015 by VRS  |  Email |Print

Oil investors who amassed a $6 billion long position in exchange traded funds, occupying as much as a third of the U.S. futures market, are now racing for the exit at a near record pace.
Outflows from four of the largest oil-specific exchange traded funds, including the largest U.S. Oil Fund (USO), reached $338 million in two weeks to April 8, according to data from ThomsonReuters Lipper. That is the first two-week outflow since September and the biggest since early 2014, marking a turnaround from heavy inflows in December and January on bets that oil prices would quickly rebound from six-year lows………………………………………..Full Article: Source

ETFs vs. mutual funds: Which is more cost effective?

Posted on 15 April 2015 by VRS  |  Email |Print

The last five years have been very good for diversified common-stock portfolios with mutual funds and exchange-traded funds (ETFs). The annual costs for both types of fund have never been lower. This has certainly made it easier for investors to have excellent results.
I can’t forecast the future, but I believe it is prudent (even for retirees) to maintain a significant percentage of one’s portfolio in common stocks, rebalancing regularly. (I like to rebalance annually.) Most investors will be better off with the majority of their stock investments in index funds, mutual funds or ETFs………………………………………..Full Article: Source

ETFs expand into Bitcoins

Posted on 15 April 2015 by VRS  |  Email |Print

WinklevossBitcoin Trust Exchange Traded Fund (ETF), which will track the performance of Bitcoins, the most talked about digital currency, will be available to investors later this year. Launched by Cameron and Tyler Winklevoss – the twins who worked with Mark Zuckerberg in the early stages of Facebook – the ETF is currently in the process of regulatory approval.
According to the Winklevoss brothers, Bitcoins is a better investment than gold as they believe it to be more durable due to the fixed supply built into the rules of the digital currency. The model of the product is based off the SPDR Gold Trust GLD ETF………………………………………..Full Article: Source

The explosion of ETFs has been unstoppable

Posted on 14 April 2015 by VRS  |  Email |Print

The growth of Exchange Traded Funds has been unstoppable. In a note Friday, Goldman’s Robert Boroujerdi points out that ETF assets under management was at $230 billion ten years ago in the US.
Today, it stands at over $2 trillion. ETFs trade like stocks but track a basket of securities, tracking stock indexes, or specific commodities or stocks in a particular country or region………………………………………..Full Article: Source

Saudis, ETF trend could exacerbate oil drop: Citigroup

Posted on 14 April 2015 by VRS  |  Email |Print

Saudi Arabia has increased the amount of crude it is pushing into an already oversupplied world market at a time when a surge in ETF investing could exaggerate any drop in oil prices, according to Citigroup analysts.
In a new report, the Citigroup energy analysts say inflows into crude-linked exchange traded funds have created “significant froth” in the oil market and could exacerbate a downside correction in the second quarter, given the market’s bearish fundamentals………………………………………..Full Article: Source

Investing Basics: ETFs and Tracker Funds

Posted on 14 April 2015 by VRS  |  Email |Print

Passive funds in their simplest form offer highly efficient and transparent vehicles through which investors can access a market. But can introduce an element of counterparty risk.
The rise of passive investing in Europe is built on the realisation that active managers struggle to outperform their benchmarks over time. While this trend reflects a deep underlying shift in investor behaviour, several common misconceptions about passive funds remain………………………………………..Full Article: Source

Exchange traded funds make strongest ever start to a year

Posted on 13 April 2015 by VRS  |  Email |Print

The exchange traded funds industry made its strongest ever start to a year with net inflows of just under $96bn in the first three months of 2015, a first quarter record. First quarter inflows were more than double the $37.2bn recorded in the same period last year, according to ETFGI, a consultancy.
The ETF industry’s best ever year was 2014, when investors ploughed a record $339.7bn into exchange traded funds and products. The surge in ETF inflows will strengthen the hand of regulators pushing for tighter supervision of asset managers………………………………………..Full Article: Source

ETF boom sees investor demand outstrip advice supply

Posted on 13 April 2015 by VRS  |  Email |Print

Financial advisers have the opportunity to extend their advice offering with only around a quarter of exchange traded funds (ETF) investments coming off the back of advice despite a 46 per cent increase in the number of investors in that space.
According to data gathered as part of the BetaShares/Investment Trends ETF Report released on Friday, financial planners are involved in only 27 per cent of investment decisions related to ETFs, a number which has been steady for the past five years. However Investment Trends senior analyst, Recep Peker, said while investor numbers are set to continue their rapid growth the number of advisers looking to provide advice on ETFs was also set to climb for the fourth year in a row………………………………………..Full Article: Source

Global ETF Assets Reach A Record $2.926 Trillion

Posted on 13 April 2015 by VRS  |  Email |Print

Record levels of assets were reached at the end of Q1 for ETFs/ETPs listed globally at US$2.926 trillion, in the United States at US$2.094 trillion, Asia Pacific ex-Japan at US$119.6 billion and Japan at US$109.3 billion, according to ETFGI’s preliminary monthly ETF and ETP global insight report for Q1.
The global ETF/ETP industry had 5,669 ETFs/ETPs, with 10,961 listings, from 247 providers listed on 63 exchanges in 51 countries. Record levels of net new assets (NNA) have been reached in Q1 by ETFs/ETPs listed globally, gathering US$95.99 billion – a significant increase on the US$37.20 billion in Q1 2014………………………………………..Full Article: Source

Global ETF/ETP Assets hit a Record $2.92 Trillion in Q1

Posted on 10 April 2015 by VRS  |  Email |Print

Record levels of assets were reached at the end of Q1 for ETFs/ETPs listed Globally at US$ 2.926 trillion, in the United States at US$ 2.093 trillion, Asia Pacific ex-Japan at US$ 119.6, and Japan at US$ 109.3 billion, according to ETFGI’s preliminary monthly ETF and ETP global insight report for Q1.
The global ETF/ETP industry had 5,669 ETFs/ETPs, with 10,961 listings, from 247 providers listed on 63 exchanges in 51 countries. Record levels of net new assets NNA have been reached in Q1 by ETFs/ETPs listed globally which gathered US$ 95.98 billion up significantly from the US$ 37.19 billion in Q1 2014, products listed in the United States gathered US$ 57.53 billion which is significantly higher than the US$ 15.06 billion gathered in Q1 2014 , ETFs/ETPs listed in Europe gathered US$ 34.96 billion is more than double the US$ 11.16 billion gathered in Q1 2014 and ETFs/ETPs listed in Japan gathered NNA of US$ 10.61 billion which is greater than the US$ 7.7 billion in Q1 2014………………………………………..Full Article: Source

Funds and ETFs to Play the Chinese Market

Posted on 10 April 2015 by VRS  |  Email |Print

Investors looking to get into surging Chinese stocks can pick from a wide variety of mutual funds and exchange-traded funds that focus on varying stock exchanges and types of stocks in the region.
In years past, most China-focused mutual funds in the U.S. invested primarily in shares listed in Hong Kong and Taiwan—including Hong Kong-listed “H shares” of mainland-China companies—and also in stocks of other companies that do a lot of business in China. A newer development is exchange-traded funds that invest in mainland-listed “A shares” of Chinese companies (which may also have shares traded in Hong Kong)………………………………………..Full Article: Source

Record Investment in ETFs

Posted on 09 April 2015 by VRS  |  Email |Print

The European ETF market has posted the best ever quarter in terms of net inflows in Q1 2015. According to preliminary calculations, investors directed €30.8 billion of net new money to European-domiciled ETFs during the first three months of 2015. This was by far the highest sum channelled into ETFs in a single quarter; greatly surpassing the previous high of €17 billion posted all the way back in Q4 2008.
In fact, by historical standards, this quarterly sum is more akin to the figures the European ETF market has usually posted on a full calendar year basis. Indeed, 2014, which I personally dubbed “a fantastic year for the ETF industry” saw net inflows of €43.5 billion for the entire year………………………………………..Full Article: Source

ETFs Show $5.7 Billion Riding on Recovery in U.S. Energy Stocks

Posted on 09 April 2015 by VRS  |  Email |Print

The worst earnings season for energy companies since 2009 isn’t stopping investors from favoring the industry above all others this year. Exchange-traded funds tracking oil and gas shares have absorbed $5.7 billion in 2015, the most inflows among 12 groups tracked by Bloomberg.
Energy shares may get a boost from Royal Dutch Shell Plc’s acquisition of BG Group Plc, after the oil and gas industry’s biggest deal in at least a decade spurred speculation of further consolidation. Strategists are forecasting a 63 percent contraction in first-quarter earnings for energy companies in the S&P 500, after predicting expansion as recently as October, Bloomberg data show………………………………………..Full Article: Source

Should You Invest In A Currency-Hedged International Equity ETF?

Posted on 09 April 2015 by VRS  |  Email |Print

In the United States, most international equity funds do not hedge their foreign currency exposure. This long exposure to foreign currencies contributed to the performance of these funds in the past decade, as the U.S. dollar weakened against major currencies.
More recently, currency movements have reversed, starting with a sharp decline of the yen over the past three years, and the more recent gradual decline of the euro versus the U.S. dollar. This trend is now weighing on the returns of currency-unhedged international equity funds. Not surprisingly, these currency movements have prompted strong flows into currency-hedged exchange-traded funds over the past two years………………………………………..Full Article: Source

Currencies Might Not Need the ETF ‘Hedge’

Posted on 08 April 2015 by VRS  |  Email |Print

Investors have rushed into currency-hedged ETFs that invest in stocks in developed markets outside the U.S. But is the tactic worth it? Primarily focused on Japan and the eurozone, investors this year have put $23.5 billion into exchange-traded funds that lock in a current exchange-rate range to protect against dollar depreciation (through the use of “currency forwards”).
These flows represent 48% of all assets spread across 29 such funds, according to XTF, but are mostly parked in a handful of funds managed by WisdomTree Investments, the iShares unit of BlackRock and Deutsche Asset and Wealth Management, a unit of Deutsche Bank………………………………………..Full Article: Source

Hottest ETFs are currency hedges, non-US funds

Posted on 07 April 2015 by VRS  |  Email |Print

Exchange-traded funds have surged in popularity in 2015, but it’s not U.S. equities that are leading the charge. Investors poured $97.2 billion into various ETFs and other similar products in the first quarter, marking the $2.9 trillion industry’s biggest start ever despite a wobbly U.S. stock market and a testy geopolitical climate, according to data from BlackRock, the world’s largest provider of such funds. (U.S.-based ETFs have about $2.1 trillion in assets.)
There essentially have been three major investment themes this year, and players in the exchange-traded market have made each work: A quest for investment themes outside the U.S.; the offshoot of that, which has seen domestic attention turn away from large caps and toward mid- and small-sized companies, and capitalizing on the big moves in currency markets, particularly an appreciation of the U.S. dollar and the decline of its global competitors………………………………………..Full Article: Source

ETFs Haul in $36.1 Billion in March

Posted on 07 April 2015 by VRS  |  Email |Print

The S&P 500, Dow Jones Industrial Average and the Nasdaq Composite fell an average of 2.4% last month, but those glum performances did not prevent investors from pouring $36.1 billion into exchange traded funds. Strong March inflows brought first-quarter ETF inflows to $97.2 billion, or nearly triple the total from the from the first quarter of 2014, according to BlackRock data.
“Global ETFs gathered $36.1 billion in March to lift Q1 flows to $97.2 billion, nearly triple the total from Q1 2014. Investors put $71 billion into non-U.S. developed equities in the first three months of the year, making it the strongest first quarter on record. Currency hedged ETFs saw inflows of $26.8 billion in Q1 as investors looked to hedge their international equity exposure due to a stronger dollar,” according to BlackRock, parent company of iShares, the world’s largest ETF issuer………………………………………..Full Article: Source

ETF Investors Have Large Footprint in Oil Futures Market

Posted on 07 April 2015 by VRS  |  Email |Print

Retail investors have become a larger force in the oil market, betting on a potential rebound in the energy commodity through exchange traded funds that track crude futures contracts. For instance, the United States Oil Fund (NYSEArca: USO), which tracks West Texas Intermediate oil, held 57,956 NYMEX May crude contracts as of March 30, compared to 7,151 front-month NYMEX crude contracts back at the end of September, reports Geoffrey Craig for Platts.
In the six months ended March 30, USO experienced $2.8 billion in net inflows, according to ETF.com. Nevertheless, USO experienced $252.4 million in outflows in the week ended April 2, which suggests that either some traders are engaging in the time-honored tradition of profit taking or some short-sellers are calling it quits by covering their calls and exiting positions……………………………………….Full Article: Source

London investors favour precious metals – ETF Securities

Posted on 02 April 2015 by VRS  |  Email |Print

Precious metals and agriculture-based exchange-traded products remain in favour among investors, research from provider ETF Securities has found. ETF Securities carried out a poll of 446 investment professionals at its investment conferences, which took place in Frankfurt, London, Paris, Milan and Zurich during January and February.
Polled attendees indicated that commodities remained a favoured asset class this year, with nearly 40 per cent of London-based investors believing that precious metals would be the best-performing sector. Meanwhile, Italian and Swiss investors favoured agriculture with 47 per cent and 30 per cent of the votes respectively………………………………………..Full Article: Source

Investing In Natural Gas ETFs And ETNs

Posted on 02 April 2015 by VRS  |  Email |Print

UGAZ, UNG, and DGAZ all have average volume over 10m shares traded per day, while the other funds have under 100k trades per day. UNG has the lowest fees, 0.60%, and no leverage.
UNG and UNL provide the best long investment options, as UNG tracks the prompt month and UNL tracks the 12 month rolling strip. UNG has underperformed the slide in natural gas over the last 6 months by -5.02%, while UNL has outperformed natural gas futures by 4.86%………………………………………..Full Article: Source

How Trading ETFs is Different from Trading Stocks

Posted on 01 April 2015 by VRS  |  Email |Print

Should you trade exchange-traded funds (ETFs) or individual stocks? With thousands of stocks traded in the marketplace, an investor has the wherewithal to construct a portfolio perfectly tailored to his or her own unique risk tolerance and investment objectives. However, there are a handful of trading situations when ETFs may be better suited than stocks for inclusion in a portfolio.
But first, what are the similarities between ETFs and stocks? Both ETFs and stocks trade on a recognized exchange. Like blue-chip stocks, the larger ETFs (like the SPDRs or “spiders” and “Diamonds”) are very liquid and have narrow bid-ask spreads. Similar to stocks, ETFs can also be sold short………………………………………..Full Article: Source

Dollar’s Rise Boosting Currency-Hedged ETFs

Posted on 01 April 2015 by VRS  |  Email |Print

As the U.S. dollar’s value has soared against other currencies, so has interest in currency-hedged exchange-traded funds. In just the first two months of this year, an estimated $11.6 billion has flowed into the 20 currency-hedged ETFs tracked by investment-research firm Morningstar Inc. That swelled the funds’ assets to nearly $35.6 billion, up from just $4.4 billion in 2013 and $21.3 billion last year, according to Morningstar.
The number of fund options has ballooned, too. More than half of the currency-hedged ETFs that Morningstar tracks were launched last year, including a group from WisdomTree Investments that provide exposure to some individual industry sectors in Japan such as health care………………………………………..Full Article: Source

Hedge Market Risks with Alternative Investments, ETFs

Posted on 01 April 2015 by VRS  |  Email |Print

After the recent swing in the equities market, more anxious investors may consider alternative investments and exchange traded funds to help even out an investment portfolio.
Alternative investments provide exposure to assets with little or no correlation to traditional stocks and bonds, which can help offset a portfolio’s potential losses in volatile conditions. For those with a low risk tolerance, an alternative investment strategy could help protect one’s assets……………………………………….Full Article: Source

Silver ETFs Outshining Peers

Posted on 31 March 2015 by VRS  |  Email |Print

While the Fed’s March meet led to a stall in the greenback’s north-bound march, it spread joy within broad-based commodity investing. Most investors focused in on gold taking cues from the Fed’s dovish comments over rate rising issues. Another corner of the precious metal world -silver - has also done quite well lately.
The white metal has seen extremely solid trading post Fed meet, and has actually breezed past not only the yellow metal, but also the entire precious metal space. The Fed slashed the U.S. economic growth projection (considering the central tendency method) for 2015 from 2.6−3% (guided in December) to 2.3−2.7%. The growth projections for 2016 and 2017 were also narrowed to 2.3−2.7% and 2.0−2.4%, respectively, from 2.5−3% and 2.3−2.5%……………………………………….Full Article: Source

Oil ETFs: Look Before Leaping

Posted on 31 March 2015 by VRS  |  Email |Print

The United States Oil Fund (NYSEArca: USO), which tracks West Texas Intermediate oil, and the United States Brent Oil Fund (NYSEArca: BNO) are down 15.8% and 8.1%, respectively, year-to-date after falling an average of 45.5% last year.
However, USO and some other futures-based oil exchange traded products present problems to buy-and-hold investors beyond falling oil prices. Structural issues, including the need for USO to constantly roll into new futures contracts has consistently hampered returns for investors opting to hold these products for long time frames………………………………………..Full Article: Source

Several ETFs set to hit market soon

Posted on 30 March 2015 by VRS  |  Email |Print

It could rain Exchange traded funds (ETFs) in the market soon as different fund houses line up innovative variants to this instrument that is gaining popularity in India. ETFs have been a big draw among retail investors in the last one year as they understood the primary benefits of diversification, risk control and lower transaction costs provided by this financial instrument.
At least four-to-five ETFs could hit the market in next few months including some interesting ones that are intended to tap inflows from foreign portfolio investors (FPI), say market watchers. On the anvil are ETFs based on the MSCI India Domestic index and two fund houses — Edelweiss Mutual Fund and Reliance Mutual Fund — have filed offer documents for launching such product………………………………………..Full Article: Source

Dividend ETFs: Yield, Quality Or A Blend?

Posted on 30 March 2015 by VRS  |  Email |Print

In the income investing universe, participants have a predisposition to focusing on ETFs with the highest headline yields. After all, income investors have a way of keying in on a yield that matches up with their spendable cash flow needs.
Yet more recently, there are a myriad of so-called “dividend growth ETFs” that sport yields just slightly higher than blended indexes, such as the S&P 500. So what gives and how can these two income styles be commingled? In my opinion, dividend investors have realized that it’s not all about the yield and to fashion a well-diversified portfolio they are going to need to straddle the lines a bit. ……………………………………….Full Article: Source

ETF investors focus on commodities

Posted on 27 March 2015 by VRS  |  Email |Print

Commodities are one of investors’ top picks for 2015, along with developed market equities, according to an ETF Securities conducted a poll at their Annual Investment Conference. The poll also indicated that investors use exchange-traded products for a number of different strategies, although tactical approaches proved to be the preferred method.
“The majority of our investors are more bullish and have more confidence about the outlook for economic growth this year, reflecting the heightened appetite for developed equities. In light of continued volatility due to macroeconomic uncertainty, portfolio diversification remains firmly on investors’ agendas and commodity allocations are a key part of that strategy,” said Bernhard Wenger, Head of European Distribution at ETF Securities commented:……………………………………….Full Article: Source

How ETF Arbitrage Works

Posted on 27 March 2015 by VRS  |  Email |Print

Market traders, especially high frequency traders take advantage of mispricings in the market, even if these inefficiencies last for just a few seconds or minutes. Mispricing can occur between two similar securities, like two S&P 500 ETFs, or within a single security, where the trading value differs from the net asset value (NAV).
Both types of inefficiencies can be exploited by market participants through arbitrage. Taking advantage of arbitrage opportunities usually involves buying an asset when it is underpriced or trading at a discount and selling an asset that is overpriced or at a premium………………………………………..Full Article: Source

Commodities set to be a focus in 2015

Posted on 26 March 2015 by VRS  |  Email |Print

ETF Securities, one of the world’s leading, independent providers of Exchange Traded Products (ETPs), conducted a poll at their Annual Investment Conferences which showed that commodities are one of investors’ top picks for 2015, along with developed market equities. The poll also indicated that investors use ETPs for a number of different strategies, although tactical approaches proved to be the preferred method.
The results were compiled from a poll of 446 investment professionals conducted during the ETF Securities Annual Investment conferences which took place in Frankfurt, London, Paris, Milan and Zurich during January and February. The conferences focused on the broad macroeconomic outlook, commodities and foreign exchange………………………………………..Full Article: Source

Commodity ETFs May Have More Room To Fall

Posted on 26 March 2015 by VRS  |  Email |Print

Commodity exchange traded funds, especially those that track base metals, could fall behind as a slowdown in China diminishes consumptions and cheaper oil helps cut costs in production. Broad commodity exchange traded products have been underperforming other asset classes. Year-to-date, the PowerShares DB Commodity Index Tracking Fund fell 5.6%, iPath Dow Jones-UBS Commodity Index Total Return ETN decreased 4.7% and iShares GSCI Commodity-Indexed Trust declined 8.3%.
Morgan Stanley has cut its forecast for almost all base metals and bulk commodities due to the lower demand from China, the world’s biggest consumer of copper, iron ore and other raw materials, reports Sungwoo Park for Bloomberg………………………………………..Full Article: Source

Buy Oil and Gas ETFs as Crude Nears Bottom to Take Advantage of Rebound

Posted on 26 March 2015 by VRS  |  Email |Print

Crude oil and energy stocks are tricky to navigate in today’s environment, when equities are nearing a bull market top. It is critical to remember that when the U.S. stock market turns down and starts a bear market virtually all stocks and commodities will fall in value including oil and energy stocks.
Investors need to understand that even though the price of crude oil is nearing a bottom it could and will likely stay low for a considerable amount of time, if the stock market turns down. Over the last 100 years we have seen nearly 30 bear markets. The average length of a bear market is 18 months and has an average decline of 30%………………………………………..Full Article: Source

GLD vs. IAU: Which Gold ETF is Better?

Posted on 26 March 2015 by VRS  |  Email |Print

Will gold rise or fall? That’s ultimately for you to decide and there are two different sides to the argument. One side is that the stock market is on the verge of imploding due to reckless Federal Reserve monetary policy, that this policy will lead to a decline in the U.S. dollar and that gold will skyrocket higher.
The other side of the argument is that deflation is around the corner and contrary to popular belief, gold wouldn’t be a good hedge in an upcoming deflationary environment. Why? Because with the European Central Bank and Bank of Japan printing money, the value of the U.S. dollar will increase………………………………………..Full Article: Source

Palladium ETFs see biggest weekly outflow since August

Posted on 25 March 2015 by VRS  |  Email |Print

Palladium-backed exchange-traded funds saw their biggest weekly outflows since August last week as prices of the white metal reversed the trend of the last two years to fall as gold, silver and platinum rose. Palladium ETFs, popular investment vehicles which issue securities backed by physical metal, saw outflows of nearly 50,000 ounces in the week to Friday, Reuters data showed.
In the same period palladium prices fell 2.1 percent, even though other precious metals ended the week higher after an unexpectedly dovish statement on interest rates from the U.S. Federal Reserve………………………………………..Full Article: Source

Oil ETF investors, not just OPEC, hold sway over crude market

Posted on 25 March 2015 by VRS  |  Email |Print

Tumult in Libya, U.S. rig counts, production plans of the oil exporting cartel and a pact on nuclear relations with Iran can all affect crude supply and demand, but oil traders have kept an equally close watch on retail investors in recent weeks.
Those investors and hedge funds, betting on a reversal of oil’s long rout, poured billions of dollars into exchange traded products at the tail end of the slide last year, providing unexpected support that helped prices stabilize. Even as concerns about U.S. storage capacity triggered renewed slide over the past week investors have stuck with the view that a bottom might be in sight, pouring more money into financial products backed by oil futures………………………………………..Full Article: Source

Are Currency Hedged ETFs Overheated?

Posted on 25 March 2015 by VRS  |  Email |Print

The big trade of 2015 has undoubtedly been the movement towards currency-hedged ETFs as a way to participate in the upside of international markets, while eliminating the underlying currency risks. These ground breaking funds accomplish this by owning a basket of international stocks with simultaneous exposure to short positions in the host country’s currency.
The WisdomTree Europe Hedged Equity ETF (HEDJ) has taken in over $9 billion in new assets since the beginning of the year. In fact, HEDJ has now surpassed the WisdomTree Japan Hedged Equity ETF (DXJ) as the largest currency hedged ETF with $16.5 billion in total assets under management………………………………………..Full Article: Source

Palladium ETFs record biggest weekly outflow since August

Posted on 24 March 2015 by VRS  |  Email |Print

Palladium-backed exchange-traded funds saw their biggest weekly outflows since August last week as prices of the white metal reversed the trend of the last two years to fall as gold, silver and platinum rose.
Palladium ETFs, popular investment vehicles which issue securities backed by physical metal, saw outflows of nearly 50,000 ounces in the week to Friday, Reuters data showed. In the same period palladium prices fell 2.1 percent, even though other precious metals ended the week higher after an unexpectedly dovish statement on interest rates from the U.S. Federal Reserve………………………………………..Full Article: Source

Pluses and pitfalls in the ETF revolution

Posted on 24 March 2015 by VRS  |  Email |Print

Exchange traded funds are the phenomenon of the moment. Money is pouring in and ETFs are proliferating. They have transformed how many savers invest their money and the way investment advisers and brokers do business.
They have also made a lot of money for stock exchanges, index providers and investment banks — far beyond the sums they generate for the companies whose names appear on the ETFs investors buy. The important questions are why they have become so important and whether you should be excited about them………………………………………..Full Article: Source

Exchange-traded funds set to eclipse hedge funds in 2015

Posted on 23 March 2015 by VRS  |  Email |Print

The global Exchange Traded Fund industry is likely to eclipse the global hedge fund industry this year on total size despite having only been around for half as long, according to eminent ETF commentator Deborah Fuhr, of independent research group ETFGI.
“March 9 marked the 25th anniversary of the listing of the first ETF in Canada,’’ she said, noting that ETFs at present account for $US2.92 trillion ($3.75 trillion) in value and should overtake hedge funds, 66 years old, in the first half of 2015. ETFs are mostly index-hugging funds favoured by retail investors for their low costs, on average 32 basis points a year or 0.32 of 1 per cent, and which have enjoyed a significant lift in inflows in Australia in the past 12 months because they offer low cost exposure to international sharemarkets……………………………………….Full Article: Source

Some Popular Global ETFs Breakout

Posted on 23 March 2015 by VRS  |  Email |Print

The current bull market for U.S. stocks is the fourth longest in history. Two others journeyed into a seventh year, while one other (1990s) enjoys the distinction as having traveled into an eighth year. Even if one subscribes to the idea that “bull markets never die of old age,” probability alone suggests that we are closer to the end than the beginning.
Many market-watchers enjoy finishing the thought on what eventually kills a powerful bull run. “Excessive valuations,” some argue. At the moment, the median U.S. stock price-to-earnings (P/E) and price-to-sales (P/S) ratios are the steepest on record, yet few fundamental analysts show concern. “Recessions,” market-based economists assert……………………………………….Full Article: Source

What About ‘Currency Hedging’ in Gold ETFs?

Posted on 20 March 2015 by VRS  |  Email |Print

Markets are feeling a bit of a hangover one day after a rowdy, post-Fed rally. Stocks, bonds and gold are all lower. The SPDR Gold Shares (GLD) is down 0.2% on Thursday. It climbed 2% on Wednesday after Federal Reserve policymakers’ lukewarm assessment of U.S. economic growth prompted market watchers to rethink how soon the central bank might raise interest rates.
Michael Dudas, mining analyst at brokerage Sterne Agee, likes the fundamental outlook for gold in the months ahead, as well as the technical picture that shows up on the charts. Barron’s recently highlighted the prospects for gold demand in the Eastern hemisphere. The upshot is that wage growth might allow consumers India and China to buy more stuff, including gold………………………………………..Full Article: Source

Short Oil ETFs in Focus as Crude Prices Keep Falling

Posted on 20 March 2015 by VRS  |  Email |Print

The oil investing phobia eased somewhat as crude saw the strongest two-week gain in 17 years early February, on sharp spending cuts by big U.S. oil drillers. But this respite was short-lived as oil prices started to dip again. Many hoped the commodity would be able to hold above $50. But to their disappointment, WTI crude fell below $44 a barrel on March 16.
A host of reasons including worries over shrinking storage facility for surplus oil in the U.S. and China, abundant supplies in non-OPEC nations and OPEC caution that production in the U.S. might not slow down before the end of the year hit the brakes on the apparent oil price recovery………………………………………..Full Article: Source

The Fastest-Growing ETFs

Posted on 19 March 2015 by VRS  |  Email |Print

The business of exchange-traded funds is dominated by three big players: BlackRock’s iShares, Vanguard Group, and State Street, which collectively control 82 percent of the roughly $2 trillion invested in ETFs. Other firms are fighting to gain market share, and several have made their way into Bloomberg Markets’ annual ranking of the fastest-growing funds over the three years ended on Dec. 31.
Charles Schwab Investment Management has two of the funds on this year’s list: Schwab U.S. Large-Cap and Schwab U.S. Broad Market. “Those ETFs are boring as dirt,” says Dave Nadig, chief investment officer at research firm ETF.com, pointing out that the Schwab ETFs track common market indexes. They’re also very cheap, which is their main appeal, he says………………………………………..Full Article: Source

Investors Pull $6.1 Billion From Bond ETFs Amid Fed Concerns

Posted on 19 March 2015 by VRS  |  Email |Print

Investors dumped exchange-traded funds that invest in bonds ahead of today’s Federal Reserve statement on concern officials would get closer to raising interest rates. Investors pulled $6.1 billion this month from bond ETFs through March 16, or 1.9 percent of total fund assets, according to TrimTabs Investment Research data.
If withdrawals continue at that pace it would surpass the record $8.6 billion monthly outflow those funds recorded in June 2013, after the Fed signaled when it might start winding down its bond-buying program………………………………………..Full Article: Source

Why currency-hedged ETFs are hot

Posted on 18 March 2015 by VRS  |  Email |Print

My colleague Michelle Caruso-Cabrera made some very good points on air today concerning investing overseas: because of enormous moves in currency, buying stocks overseas—including ETFs—can be perilous.
As an example, she notes the German DAX index is up 22 percent this year, but the iShares Germany ETF, which measures the performance of the German equity market, is up only 8 percent in U.S. dollars, thanks to the tremendous drop in the euro (down almost 13 percent against the dollar)………………………………………..Full Article: Source

ETF Risk Management in a Strong Dollar World

Posted on 18 March 2015 by VRS  |  Email |Print

Historically, when the U.S. dollar surges, forward S&P 500 earnings plummet. In the same vein, the last two times that the world’s reserve currency skyrocketed, the U.S. economy slipped into a recession. Come on, Gary. Do you really think that we have already dipped into recession territory? No, I do not.
Yet the idea that the Federal Reserve can permanently prevent an economy (or a stock market) from succumbing to cyclical forces is foolish. In fact, Federal Reserve Open Market Committee (FOMC) members now have to deal with byproducts of six-plus years of zero percent rate policy, including unfamiliar volatility in market-based securities as well as the impatient ascent of the greenback………………………………………..Full Article: Source

U.S. Dollar Takes Gold ETFs For A Ride

Posted on 17 March 2015 by VRS  |  Email |Print

Gold and bullion-related exchange traded funds have exhibited an inverse relationship against the U.S. dollar, but the moves this time around may not be as severe. Over the past year, the SPDR Gold Shares (NYSEArca: GLD) has declined 16.1%, whereas the PowerShares DB U.S. Dollar Index Bullish Fund (NYSEArca: UUP) jumped 24.2%.
Gold has shown a history of moving inversely with the USD. In 1971, U.S. President Richard Nixon ended the U.S. dollar to gold conversion, sending the dollar into a free fall and lifting gold prices to a peak of $850 per ounce, reports Henry Sanderson for the Financial Times………………………………………..Full Article: Source

Assets in ETFs/ETPs Listed in the United States Reach a New Record High

Posted on 17 March 2015 by VRS  |  Email |Print

March 15, 2015 — assets invested in ETFs/ETPs listed in the United States reached a new record high of US$2.089 trillion at the end of February 2015, according to ETFGI’s monthly ETF and ETP global insight report for February.
The US ETF/ETP industry had 1,667 ETFs/ETPs, from 73 providers listed on 3 exchanges at the end of February. March 9th marked the 25th anniversary of the listing of the first ETF in Canada. “Investors allocated the majority of net new assets to equities as the US market rebounded from a difficult January to end February with both the S&P 500 and the Dow up 6% for the month. Volatility declined during the month……………………………………….Full Article: Source

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