ETP Roundup: Structured products linked to iShares ETFs sell more than US$1 billion in Q3

Blackrock has reported assets under management (AUM) of US$6.44 trillion at September 30, 2018, up 8% year-on-year, including US$28 billion of net assets added from strategic transactions. Sixty-one percent of AUM was generated by institutional investors, followed by iShares ETFs (29%) and retail clients (39%). By region, 67% of AUM came from the Americas, with the remaining assets managed in Europe, Middle East and Africa (26%) and Asia-Pacific (7%), according to the asset manager’s 3Q 2018 results. Quarterly long-term net inflows of US$11 billion were led by iShares, active multi-asset and illiquid alternatives while 2% growth in revenue year-on-year was driven by 4% base fee growth and 18% technology services revenue growth, partially offset by lower performance fees.

There were 512 structured products linked to iShares ETFs and worth a combined US$1.3 billion added to the SRP database between July 1 and September 30, 2018. Of these, 283 products worth US$644.9m struck in the US. Investors in South Korea and Canada, with US$323.3m (108 products) and US$103.8m (61 products), respectively, also invested heavily in structured products linked to iShares ETFs. The most popular fund during the quarter was iShares China Large Cap ETF, which accumulated sales of US$462m from 137 products, according to SRP data.

Kazakhstan ETF begins trading in Moscow

The Moscow Exchange (MOEX) has started trading in the Kazakhstan Stock Exchange (KASE) index exchange-traded fund (ETF). The ETF, which is managed by FinEx Investment Management LLP, is listed on MOEX’s Level 1 under the ticker FXKZ with investment company Freedom Finance acting as the market maker.

The ETF is traded in roubles and linked to the share price denominated in Kazakhstan tenge (KZT), since the ETF’s assets value is calculated in KZT. On October 16, 2018, the first day of trading, the ETF’s launch volume was RUB320m (US$4.9m). The KASE ETF comprises shares of the seven largest Kazakh equity issuers: Bank CenterCredit and Halyk Bank (financial sector), Kazakhtelecom and Kcell (telecommunications), KAZ Minerals and KazTransOil (commodities) and Kegoc (energy). The weight of each security in the fund will be similar to its weight in the KASE index.

WisdomTree teams up with Pimco for ETF model portfolios

WisdomTree Investments and Pimco have started to work together on three WisdomTree ETF model portfolios in which Pimco’s fixed income ETFs will be added. The ETF portfolio analysis tool is available to advisors in the Model Market Center on the TD Ameritrade Institutional Platform, a brokerage services provider, and through Advisor Engine, a digital wealth management platform. The risk profiles of the ETF model portfolios powered by WisdomTree range from conservative to aggressive, and accordingly, combine the outperformance potential of active management with the benefits of the ETF structure.

Columbia Threadneedle Investments expands strategic beta ETF offerings

Columbia Threadneedle Investments has expanded its strategic beta ETF offerings with a new fund that tracks the Beta Advantage Multi-Sector Municipal Bond Index. The benchmark offers exposure to five sectors of the municipal bond market in the US using a rules-based approach to bond selection. The asset manager expects the Columbia Multi-Sector Municipal Income ETF to not only serve as a core municipal bond allocation in investors’ portfolios but also complement traditional benchmark products so that investors can have higher tax-exempt incomes and risk-adjusted return potential. The interest income earned from most municipal bonds is exempt from all federal income taxes regardless of one’s tax bracket. The new ETF comes with an expense ratio of 0.28% and is listed on the NYSE Arca.