My favorite ETF reads over the past week, along with my ETF tweet and chart of the week!
“The planned launches from Morgan Stanley are the latest in a series of investment giants caving to the ETF industry.”
“This kind of access is a potential game changer for not just retail investors but also small to midsize ETF issuers as well.”
“The way these products work is exactly the way they’ve worked for over a decade for traders with a high-conviction view.”
“With the ETF market becoming more crowded weekly, advisors have their hands full trying to sort through the universe.”
“What if you gained notoriety first, then became a fund manager?”
“The Jack Bogle of hedge funds.”
ETF Tweet of the Week: Newfound Research’s Corey Hoffstein succinctly summarizes the ETF industry’s current state of the play (click tweet to read entire thread). Successful ETF issuers can either: 1) operate at massive scale, being all things to all investors at a lower price point, or 2) position as a boutique brand, offering meaningful differentiation and high touch. I call this the ETF industry barbell. Players in the middle (who are neither) will continue to get squeezed.
I see a lot of people who come from trading or hedge fund backgrounds mis-understand what ETFs are.
99% of ETFs aren’t trying to beat the market.
99% of ETFs are simply trying to deliver an exposure.
ETF sponsors are in the business of selling shovels, not panning for gold.
— Corey Hoffstein 🏴☠️ (@choffstein) August 18, 2022
ETF Chart of the Week: Combined flows into ETFs, mutual funds, and money market funds have turned negative this year for the first time ever. Investors are shunning mutual funds and even money market funds, though notably, ETFs still have inflows. So, where is the money going besides into ETFs? State Street’s Matt Bartolini surmises investors are turning to cold, hard cash – an interesting choice given the inflationary environment.
Source: State Street’s Matt Bartolini