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Welcome to Issue 15 of Exchange Traded Fridays for the week ending 29th October 2021. In this week's news we see a strong focus on the bitcoin futures ETF with the 2nd one listing from Valkyrie (after BITO being the initial listing last week) in the US and another blockchain listing in Australia called DIGA from Cosmos as well as a new ETF listing from eInvest/Perennial with DHOF out next week. There was also news on ETF investors buying the dip in September and we dive into some data on HACK and MOAT.
Additionally, this week we did a revisit to market making by bringing back our Week 5 guest, Kevin Feerick of Nine Mile Financial to go through primary and secondary ETF markets. You can view that here or in the videos section.
What's in this newsletter?
Local ETF Articles
Global ETF Articles
Tweet of the week
Chart of the week
ETFtracker App Links
Listen or Watch
Articles - Local
AFR - Specialist ETFs can spice up your index fund portfolio - In this article, Tim Mackay shows that ETFs are not just the boring, index-tracking, passive investment vehicles that are synonymous with the industry. Rather, there are plenty of thematic ones out there (not just the newly listed bitcoin/blockchain related ones). If you thought ETFs were just about the boring, then this article will help bust that myth.
Sydney Morning Herald - Australian firms line up to launch ‘inevitable’ local Bitcoin ETFs - with the launch of a bitcoin futures ETF in the US, talk is high for when a local version of bitcoin (not blockchain) exposure will come. They speak with Alex Vynokur from BetaShares and Heath Behncke from Holon to get the investment manager opinion on this. Regulation is going to be required.
Motley Fool - 2 excellent ETFs for ASX investors - in this article it's all about HACK and MOAT with the Motley Fool team looking at some of the holdings in these 2 ETFs. Watch the episode as we go through these ETFs via ETFtrackers tools (or listen in on our podcast page above, or via Spotify).
AFR - Bitcoin miners fund floats amid crypto ETF race - In this article it's about a new ETF listing that's also blockchain related from Cosmos (the Cosmos Global Digital Miners Access ETF). In this article they talk to CEO Dan Annan (formerly of BetaShares which is also listing a blockchain ETF soon). This is the 3rd announced but 2nd listed as FTEC listed already (from ETF Securities) and CRYP from BetaShares was announced but not yet launched.
ETF Securities - Weekly Report - w/e 22nd October - Per ETF Securities: "Global equity markets edged higher last week. Oil continued its strong streak and Silver performed well. The best performer over the week was ETFS Physical Silver (ETPMAG) up 3.7% and VanEck Vectors Video Gaming and eSports ETF (ESPO) was up 3%. The worst performers over the week were ETFS Physical Palladium (ETPMPD) down 5.8% and BetaShares S&P/ASX 200 Resources Sector ETF (QRE) down 2.7%." More details in the PDF.
Articles - Global
Bloomberg - Bitcoin’s True Believers Scorn ETFs While Welcoming Validation - In this article we see that true crypto enthusiasts are not flocking to buy the shares of the bitcoin linked ETF from ProShares which launched to much fanfare last week. Data from Vanda Research shows that retail traders didn't do as much of the record trading volume that was seen in the ETF (which reached over $1 billion in FUM in its first week).
CryptoSlate - Bitcoin Futures ETF is so popular that it’s breaching futures limits set by TradFi - In this article on the BITO Bitcoin Futures ETF it's all about the contract limit for the month of October for this futures product. It's got a limit of 5k and 1.7k was left as at the time of this article which could see a need for an increase in limit size prior to the planned increase in November
CoinDesk - Valkyrie’s ETF Debut Soured by Falling Bitcoin Market - Talk about timing, Valkyrie's own version of a bitcoin futures ETF was not as great as rival ProShares as the price of bitcoin fell to $60k from the all-time highs of $67k it reached earlier in the week.
Bloomberg - Tiny ‘Pop Culture Disruption’ ETF Is Winner Thanks to Trump SPAC - This article talks about the Simplify Volt Pop Culture Disruption ETF which rose to highs of 47% on Friday as its biggest holding Digital World Acquisition Corp is merging with former US President Donald Trump's new media company. Whilst many thought the world of SPACS (special purpose acquisition company) was dead, it's been reignited with this latest news. Is this just a once off though is the real question.
ausbiz - Why this new hybrid ETF is worth a closer look - 28th October 2021 - In this episode the team talk to Brad Dunn at Perennial/eInvest and their new Daintree Hybrid Opportunities Fund (DHOF) which is a quoted managed fund with an active strategy and market making in this which ensures the fund is trading at close to NAV, avoiding issues that can be seen in seeing trading differences to NAV in other unlisted funds. Launches on November 3 so check out this video. 5mins
ausbiz - Where the investors are buying the ETF-sized dip - 26th October 2021 - per the show notes "ETF investors have been buying the market dips in September with last month seeing the highest inflows on record - again. Among the key trends, Blair Modica from Betashares tells us the mix of flows was more mixed than this time last year." 4mins
ausbiz - As EV demand surges, get on board the lithium bandwagon - 26th October 2021 - per the show notes "As the Hertz/Tesla deal hits the headlines, pushing TSLA market cap through the trillion dollar barrier, David Lane from Ord Minnett runs the ruler over the global Electronic Vehicle (EV) market, its impact on lithium and how investors can participate." 5mins
The ETFtracker Show - Week 11 - Primary and Secondary ETF Markets - In this episode we go to a viewer question on primary and secondary markets and how they work in the ETF space. This is a follow up to week 5 of our interviews which covered market making. 7mins
The Compound - Hyperinflation, "It's Happening" | Animal Spirits 228 - per the show notes "On episode 228 of Animal Spirits, Michael Batnick and Ben Carlson discuss worrying too much about the markets, Jack Dorsey's hyperinflation call, inequality in the stock market, trying to explain crypto to "civilians," Squid Game, Dune, and much more." 45mins
Podcasts CNBC's ETF Edge - The Bitcoin ETF Craze - per the show notes "CNBC's Bob Pisani spoke with Steven McClurg, CIO at Valkyrie Funds and Tom Lydon, CEO of ETF Trends. They discussed the world of crypto as more and more companies are jumping on the bitcoin futures ETF bandwagon, So far, the new trend has really taken off, so how can investors get in the game, and how might they look to bitcoin as a way to hedge against inflation? In the ‘Markets 102’ portion of the podcast, Bob continues the conversation with Tom Lydon from ETF Trends". 27mins
The Compound - Want-trepreneur - 22nd October 2021 - per the show notes "On this week's episode of The Compound & Friends, , , and discuss private and public markets, trend following, having an edge, Robinhood, pandemic influenced businesses, envy and insecurity, the next wave of investors, and much more!" 1hr25mins
Tweet of the week From the desk of Eric Balchunas of Bloomberg on October 26 - per Eric's tweet "It’s perplexing to me that so many of my colleagues don’t use Twitter, even ones who cover these cos. You just don’t get this kinda in the moment sht on LinkedIn."
He's right, you don't get this kind of talk between companies like this in a single conversation... count it, ARK Invest, Twitter/Square, Tesla, Microstrategy.
Chart of the Week This week's chart of the week is from ETFtracker and it is the most recent 1-month total returns for Australian Equity related ETFs. This is a list of 55 ETFs including tickers you would likely know like VAS, A200, ATEC, IMPQ, IOZ and more. The addition of each of these months gives just under 12% returns to September 2021. There were 50 ETFs in this category in 2020 and the cumulative average up to September was less than 5% and in 2019 there were 48 with a cumulative average of over 18%. Interesting to see how 2021 compares isn't it?
Further ETF Education Equity Mates - Get Started Investing - Episode 1 - per the show notes "ETFs For Beginners with BetaShares is a series to help you understand everything you need to know about ETFs when you're starting your investing journey. Over 3 episodes we unpack all the kay elements from the basics, through to the administration after you buy. In this episode we sit down with Ele De Vere from BetaShares, to walk through the basics."
Check out Episode 2 and 3 as well.
Access the ETFtracker App
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ETFtracker Podcast and Videos Before we go further, if you'd prefer to consume all this content in more convenient forms of media, we've launched The ETFtracker Show as a podcast and video and Exchange Traded Fridays comes at the end of each week. Additionally, we've launched a series of interviews with various ETF market participants.
You can also access the podcast directly on our website here: https://www.etftracker.com.au/podcasts
If you're interested in financial news you should check out ausbiz (sign up HERE) which has so much FREE financial and business content that comes out every day and has made it easier to follow your favourite topics and market experts. We get to feature on there and you can check out our page (and give us a follow) here: https://www.ausbiz.com.au/expert/mark-monfort?expertID=179