Welcome to Issue 3 of Exchange Traded Fridays.
Another week of Olympics action and Australia currently sits 4th on the tally of gold medals behind China, USA and host Japan and equal our best haul of gold medals since Athens in 2004. The mens and womens Australian basketball teams put up valiant efforts but we went down to 2 powerful USA teams. The mens team is still up for a bronze medal so we'll watch that one this weekend. Come on Aussie!
Back to local markets and this week the biggest piece of news was the Afterpay (ASX:APT) buyout by US payments company Square (NYSE:SQ) for $39 billion. A coup for both the owners of that company plus investors. There are a few ETFs that have exposure to APT and other buy now pay later stocks so it's worth a look into.
Globally, it was all about ETF flows as we saw articles highlighting more money going into ETFs than ever before and more of that money going to active managers than ever before. We also get a view on some new thematic trends for ETFs.
Also we had a podcast-inception moment with Monday seeing us have an appearance on the TEP Investment podcast talking about data, technology and of course, ETFs. Check that out in the podcast section below.
Lots of ETF related videos out this week too from the team at ausbiz and more.
Bumper issues so hope you're strapped in!
What's in this newsletter?
Listen or Watch
Articles - Local
Articles - Global
Chart of the week
Listen or Watch Before we go further, if you'd prefer to consume all this content in more convenient forms of media, we've launched the Exchange Traded Fridays podcast and it's also on YouTube.
You can also access the podcast directly on our website here: https://www.etftracker.com.au/podcasts
The Weekly Wrap
Articles - Local
Livewire Markets - Why Square's $39bn bid is only the beginning for Afterpay - Whilst not directly an ETF play, we do see quite a few ETFs with holdings in the Aussie Buy Now Pay Later stock. ATEC has the biggest exposure with +18% and others have lower amounts. In this article, Ally Selby of Livewire and Joe Magyer of Lakehouse Capital go through more details about the acquisition and what's up next.
Livewire Markets - Fake megatrends: The big themes to avoid - Last week we saw the megatrends issue from the Livewire team earlier in the week but on Friday they came out with the megatrends to ignore. In this category for the ETF space, Kanish Chugh of ETF Securities highlighted short-term ETFs as ones to avoid. This includes work from home and Covid related ETFs. See more in the article from other fund managers.
BestETFs - 2 of my favourite ETFs to own for growth - In this article, Jaz from BestETFS look at 2 BetaShares ETFs that investors may want to look at if they want to own for growth, QLTY and CLDD.
ETF Securities Weekly ETF Monitor for week ending 30th July - this week they highlight mixed markets for commodities as Gold and Silver rallied last week but platinum and other metals were amongst the worst performers. More in the report.
AFR Wealth Generation - Open Markets Group did a bit of analysis on meme stocks and how, once the hype's set in, the run up in those companies is effectively over. By the time it's popular on Google or Reddit, it's already over (see chart below). This article comes from the AFR's Wealth Generation newsletter which you can sign up for here.
Articles - Global
Bloomberg - Cathie Wood Is Just a Start as Stock Pickers Storm the ETF World - Active ETF managers are taking up more of the share of new money going into ETFs in 2021 as more investors make concentrated bets with discretionary asset managers. 12% of total flows have gone to active even though it only has 4% of the market.
CNBC - These are 2021's next big themes according to two top ETF managers - Hydrogen and Clean Living make up new ETF thematics that some top fund managers from Global X and Amplify are seeing investors interested in.
ETF Stream - Investors in S&P 500, 400 and 600 index funds save $357bn in 25 years - Research from S&P shows that investors have saved $357 billion in management fees over the last quarter of century
FT.com - US ETF inflows surge past $500bn this year to eclipse 2020 record - half a trillion dollars went into US ETFs in less than 8 months, more than all of last year. Equity ETFs paved the way with financial advisers increasingly using this investment vehicle over there.
The Street - Tuttle Files For A Short ARKK ETF - article about the short ARK ETF recently filed and the move in investor sentiment against the famed Cathie Wood led ARK Invest fund. More on this topic in the videos section below.
CNBC - Robinhood surges 50% in second day of wild trading, up 100% this week -after dropping 8% on its first day, Robinhood shares (NYSE:HOOD) are up 100% as at the time of writing and one of ARK Invest's ETFs has a bit to do with that.
Bumper week for Ausbiz ETF related videos. We only list a few below but you can see more from this week (and historically on their site). also interesting to see The Compound this week. In this week’s market wrap up there are a couple of ETF related sections. First up is the short ARK ETF – SARKK which may be more of a marketing play than anything but does present an interesting pair trade opportunity as the guys discuss. Additionally the mention the latest news on bitcoin regulation with SEC Chair, Gary Gensler talking about crypto and other token type products needing regulation just as much as any other security and why that’s a positive for some investors.
Additionally, we add Kenny Polcari's daily updates. Kenny is a CNBC and ausbiz market contributor in the US. He's also a former NYSE trader and along with his daily newsletter you also get some cool food recipes at the end of each episode.
Ausbiz - 4th Aug - The ETF investor's guide to Friday's jobs read in America - Brad Dunn, eInvest - 4mins
Ausbiz - 3rd Aug - An opportunity for those seeking global investments - Darren Thompson, Equity Trustees 5mins
Ausbiz - 3rd Aug - Three ETFs for the growth vs value debate Alex Holmes, BetaShares - 5mins
Ausbiz - 2nd Aug - Why buy the Amazon dip James Whelan, VFS Group - 8mins
Ausbiz - 2nd Aug - Report Card: FAANGs pass... but not with flying colours Kanish Chugh, ETF Securities - 4mins
Ausbiz - 2nd Aug - Perspective is key to investing in China Damon Gosen, VanEck - 6mins
Host of the Party - Market Commentary from Kenny Polcari (daily) 14mins
This week was interesting across other podcasts as we had a bit of podcast-inception with our own appearance on someone else's podcast (see image below). This isn't the first time we've been on another show but it was great to talk with someone who's into data and investing as much as we are. This was with Tom Perfrement of TEP Investments in the UK. You may have seen his recent piece in Livewire Markets being interviewed by founder James Marlay (here) so this made for a great chat as Tom is also a data nerd like me.
Lastly, it was a bumper edition for ETF Prime with a massive podcast. They talk about what has driven record flow but also the potential headwinds that ETF flows face like the spread of delta variants of covid, inflation, the battle of the major economies like China and the US and valuations. That's just the first 10-15mins. After that it's Bitcoin ETF discussions and ARK Invest. Its a long episode so you might need to listen to this in parts.
Webinars Superhero with BetaShares - 10th Aug - upcoming webinar next week with the popular trading platform and ETF Issuer. In this webinar, ETF investors will learn how to take control and choose where their super is invested as well as a live Q&A BetaShares Quarterly Economic and Investment Update - 12th Aug - third quarterly economic and market update with BetaShares Chief Economist, David Bassanese, discussing some of the most important investment themes emerging over the second half of this year.
Tweet of the week This weeks its a tweet from 'The Street' that takes out top honours with their update of the top performing US ETFs in July - https://twitter.com/TheStreet/status/1422308774430355459
Chart of the Week
This one comes as a screen grab from The Compound podcast listed above. It shows the maximum drawdowns investors would have had each year if they had been long term buyers and holders of Amazon stock from inception until now. Investors obviously would have made much more than these losses but they would have needed the mental/emotional fortitude to stick it out. This comes at around the 26min mark as they discuss the variety of factors that can affect price movements.
Further ETF Education
BetaShares, one of the ETF Issuers shared educational content this week. They have an upcoming webinar "Introduction to Exchange Traded Funds" which will cover the following:
Different types of exchange traded products (ETPs), including:
Passive vs active
Australian and international shares
Sectors and thematics
How to distinguish between different ETPs and factors to consider in determining which is right for you
Buying and selling exchange traded product
How the different types of funds can be used in a portfolio
Building a portfolio to help meet your financial objectives
Diversifying your portfolio with exchange traded products
You can access the registration form HERE
We have the main ETFtracker App you can access (below) as well as holdings analysis apps for ETFs from iShares, BetaShares and State Street. See the main ETFtracker app here: https://www.etftracker.com.au/the-app
ETFtracker Forum If you're not already a member of the ETFtracker Forum then please sign up - you can access conversations and share ideas amongst peers for free. Sign up is free: https://www.etftracker.com.au/forum In the forum we've started getting a few messages about portfolio reviews as well as reviews of individual ETFs and have been using the data insights from the ETFtracker app to answer some of these. For example, we showed via the forum an animated image of how to use the comparison feature to look at property related ETFs (you can check out the full post here: https://www.etftracker.com.au/forum/portfolios-and-etf-analysis/djre-analysis-request
ETFtracker Socials - YouTube, Spotify, Instagram, Twitter, TikTok
We're on a few platforms (some more than others) so look up ETFtracker on your favourite platform for more.
Below is an example of our last YouTube video covering the last newsletter.