Monday 15 October 2018

Who likes ETFs?!

Not I! Ha! 'Do you even know what ETFs are, boss?' Ha! 'Well, do you?' Ha, ha, ha! Don't ask me such questions, Voice.

Anyway, EDHEC, a business school, has done a survey or something. 'How do you know?' They told me in an email. 'Oh.' Yeah.

The EDHEC European ETF and Smart Beta and Factor Investing Survey, polled 163 European ETF and Smart Beta Investors and found that:

'What did they find, boss?!' Be patient! Please! Christ!

Investors show a significant interest for Fixed-Income Smart Beta solutions and plan to increase their investment in them, but they do not consider there to be enough research in the area.

Oh, okay. 'Is that it?!' No.

Since 2006, the increase in the percentage of investors using ETFs in traditional asset classes has been spectacular: in 2006, 45% of respondents used ETFs to invest in equities, compared with 92% in 2018. As for governments and corporate bonds, the results grew from 13% and 6% in 2006, to 62% and 66%, respectively, in 2018.

Okay. Fair enough. I think -  'Is that it?!' No.

Appreciation has remained at high levels, especially for traditional asset classes, with a significant increase for equity ETFs and government bonds which now enjoy rates of 97% and 92%, respectively.

Okay, okay. Thank you for that, EDHEC. 'Is that it?!' Jesus H. - !!! No.

About two-thirds of respondents (67%) used ETFs to invest in Smart Beta in 2018, a considerable increase compared to 49% in 2014.

Great! And -

Despite this strong motivation, more than 80% of respondents invest less than 20% of their total investments in Smart Beta and Factor investing strategies.

Well, well. Okay, okay. 'Is that it, boss, finally, like?' Ha! No.

50% of investors still plan to increase their use of ETFs in the future despite the already high maturity of this market and high current adoption rates. Top concerns for the respondents are the further developments of Ethical / SRI ETFs, emerging market equity and bond ETFs and Smart Beta ETFs, including multi-factor and smart bond indices.

That ... is it, Voice, reader(s)! / Now, Lionel Martellini, director at the EDHEC-Risk Institute, would be happy to talk about anything I'd like, but - 'Who says?!' The PR person. 'Oh.' But I'm not in the mood. I'm not even into ETFs. 'Why don't you talk to him about music then?' He only likes ETFs, Voice.

...

Right. Anything else? Music? I'm really pleased with my new song, man. It's called Malibu, and it will be on the demo. [Unless I change my mind.] The rhythm in the chorus is a bit similar to another song that will be on the demo, but ... I'll just play it with a slightly different emphasis, you dig? That'll be all right. AC/DC have used the same rhythms in countless songs, with slight variations. 'And Burt Bacharach, Mikey!' Yes, and Burt, too, Voice. 'And Bob Marley!' Well, obviously. Our Bob. That's reggae, ain't it?

Laters!