Omicron volatility? How ETFs are obliterating 2020’s record, gathering $800 billion in new money so far in 2021

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Hi. we have returned! And so there is volatility in the market. In the midst of all this carnage, where can you take cover in exchange-traded funds? How’s the Year So Far for ETFs? We’ll discuss all those things and more in our first issue since Thanksgiving and the start of the last month of 2021.

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You know the practice: Suggestions, or send feedback, and find me on Twitter @mdecambre Or linkedin, as some of you are used to, let me know what we need to jump on.

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Good…
Top 5 beneficiaries of last week

%Display

Vanguard Extended Term Treasury ETF
edv,
-0.30%

6.4

iShares 20+ Year Treasury Bond ETF
TLT,
-0.28%
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4.9

SPDR Portfolio Long Term Treasury ETF
sptl,
-0.31%

4.6

Vanguard Long-Term Treasury ETF
vglt,
-0.31%

4.6

iShares 10-20 Year Treasury Bond ETF
tlh,
-0.35%

3.8

Source: FactSet, as of Wednesday, December 1, excluding ETNs and leveraged products, NYSE, Nasdaq and Cboe Traded ETFs Include $500 Million or GreteR

…and worse
Top 5 rejecters of the past week

% Display

United States Oil Fund LP
Use,
+1.76%

-14.8

United States Natural Gas Fund LP
Spoiled,
-4.46%

-9.9

iShares GSCI Commodity Dynamic Role Strategy ETF
COMT,
+1.01%

-9.5

iShares MSCI Chile ETF
ECH,
+0.48%

-9.3

Invesco DB Commodity Index Tracking Fund
dbc,
+0.57%

-8.9

Source: FactSet

Bumper year for ETFs

Todd Rosenbluth of CFRA told us that the recent volatility in the market hasn’t dampened demand for ETFs, before Omicron concerns took choppy market action to a new level.

Rosenbluth notes that the ETF has so far attracted about $800 billion in new money, as of the end of November, in 2021. That’s an astonishing figure that breaks the old record set last year of $504 billion – and we still have almost a full month to go. The current tally means that net inflows into the ETF were about $72 billion a month.

“Equity ETFs represent 79% of the ETF market and have been extremely popular in 2021, but fixed income ETFs have consolidated to 23% of net inflows during the first 11 months,” says Rosenbluth, Head of Mutual Funds and ETFs. Research.

Analysts note that fund provider Vanguard funded the most among the top 10 providers, BlackRock’s BLK,
+2.39%
iShares pulled out the most money.

Rosenbluth writes, “While Vanguard has six of the 10 most popular ETFs to buy in 2021, it is led by the Vanguard S&P 500 ETF and the Vanguard Total Stock Market ETF.

CFRA

ETF specialist Mark Knowles, director of Alpha FMC – an asset management consulting firm that works with 90% of the top 20 global asset managers by assets under management – says he advises such managers to adopt ETF strategies Used to be.

Much of the growth in the ETF industry has occurred amid the boom in actively managed ETFs, the emergence of non-transparent vehicles, and the outright conversion of mutual funds into ETFs.

ETFs in the Fridge

Innovations around precision farming, meat and non-meat manufacturing are among the key elements of what some describe as the future of food. The trend is something that might have got Thomas Malthus very excited and we are now looking at a new ETF that focuses on the sub-sector.

The folks at VanEck are introducing the VanEck Future of Food ETF, with the ticker symbol YUMY, on the Intercontinental Exchange—ICE.
+1.98%
Owned by the New York Stock Exchange’s Arca platform.

An actively managed fund has a carry-and-expense ratio of 0.65%, which translates to an annual cost of $6.50 for every $1,000 invested. Some of its largest holdings will include alternative milk provider Oatly Group AB Otley.
-2.50%,
As well as Corteva Inc. CTVA,
+3.96%,
An agricultural innovation company that was spun out of DowDupont as well as Givaudan GVDNY,
+1.80%,
Swiss-based manufacturer of flavors and fragrances, and Westchester, Ill.-based Ingredion Inc. INGR,
+1.47%,
, which develops modified starch among sugars.

ETF to NFT? OFC!

There are plenty of ETFs pegged to crypto and blockchain, but defense ETFs are targeting a much narrower segment of digital assets: non-fungible tokens, or NFTs. Defense co-founder and chief investment officer Sylvia Jablonski declared that NFTs “could be bigger than the Internet.”

wall street journal The report states that interest in NFTs – digital collectibles that can be used to authenticate an asset using blockchain technology – has exploded amid “$10.67 billion in trading volume in the third quarter of this year.” production, up 704% from the second quarter,” citing data from digital analytics firm DappRadar.

However, whether this is ultimately a fad or something that predates the importance of the Internet, although this remains to be seen.

Defiance Digital Revolution ETF NFTZ,

The NYSE trades on Arca and tracks the BITA NFT and Blockchain Select Index. Its expense ratio is 0.65%.

It’s not clear whether the fund is markedly different than many other crypto-adjacent ETFs in existence, but Defiance describes the fund’s strategy as follows:

The index and consequently the fund is expected to focus its investments (i.e., holding more than 25% of its total assets) in the securities of crypto and blockchain companies. As a result, the value of a fund’s shares can rise and fall higher than the value of a fund’s shares that invests in the securities of companies in a broad range of industries.

what to buy

CFRA’s Rosenbluth iShares Broad USD High Yield Corporate Bond ETF USHY is rated as,
+0.48%
A five-star rating, citing its performance (which is no guarantee of future results) and its expense ratio. Rosenbluth says the ETF is worth a look compared to some of its more expensive rivals like the iShares iBoxx $ High Yield Corporate Bond ETF HYG,
+0.58%
and the SPDR Businesshala High Yield Bond ETF JNK,
+0.53%,

The funds are down at a comparable level year-over-year, with USHY outperforming its rivals slightly.

The iShares USHY product has an expense ratio of 0.15%, compared to SPDR’s 0.40% expense and iBoxx, which has an expense ratio of 0.48%.

This week, fixed-income ETFs (see attached table) were among the best performers, with concerns about volatility and the Omicron variance prompting investors to make adjustments to their portfolios or at least seek some protection. force to.

what’s in a name?

Several companies are benefiting from the name change, including Square SQ,
-2.65%,
Which recently announced that it would be known as Block, as CEO Jack Dorsey prepares to double down on digital assets and blockchain on payment processors after the entrepreneur announced he would be joining the social-media platform Twitter Inc. TWTR. departing from,
-1.54%,

But anyone doubting the efficacy of a name change on their business (even if the profit-making company isn’t changing its name) needs to look only at the Roundhill Ball Metaverse ETF Meta,
+0.52%,
Facebook has apparently seen a 548% increase in flows since it changed its name to Metaverse, business insider report,

What to do amid the Omicron chaos

Despite Omicron-induced agility in the market, “SPY,” flows in the SPDR S&P 500 ETF Trust SPY,
+1.64%
Were strong, as were similar equity ETFs such as the Vanguard S&P 500 ETF VOO,
+1.63%,
Investors also jumped into ProShares UltraPro QQQ TQQQ,
+2.11%,
ProShares Ultra VIX Short-Term Futures ETF UVXY,
-6.54%
and Global X Nasdaq-100 Covered Call ETF QYLD,
+0.88%,
CNBC reported.

Meanwhile, the US Global Jets ETF Jets,
+5.68%,
The company, which holds 50 stocks in major airlines, has been at the center of business reopening from COVID and took a big hit as the Omicron version imposed new or extended restrictions on travel. etfmg travel tech etf away,
+1.94%,
Those investments were focusing on travel and tourism-related industries.

US Global Jets was down 0.7% in the week, while the Travel Tech ETF was down 1.3% so far this week.

Marketwatch’s Tomy Kilgore writes that the triple-short Nasdaq 100 ETF, the ProShares UltraPro Short QQQ ETF SQQQ,
-2.52%,
It was one of the most active funds on US exchanges on Thursday.

good etf reads

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