It is still a record volume in the first quarter for the ETFPlus segment of Borsa Italiana. 1.446.529 contracts were concluded (+5,08% compared to the same period of 2015) for a value of 29,04 billion euro (+5,83%). At the end of March, the total assets of Exchange traded products (ETPs) reached 48,51 billion, up by almost 7% compared to twelve months earlier. Net flows amounted to 2,86 billion.
The debuts
In the first three months of the year, 51 new index products were listed, bringing the total number of ETFs (listed passive funds) to 739 and ETCs/ETNs (commodities, currencies, etc.) to 301. the so-called strategic betas prevailed, which aim to obtain better performances or a different risk profile compared to capitalization benchmarks, and trading instruments (leveraged and short). Among the most active issuers are Lyxor, DB X-trackers, State Street Global Advisor SPDR and UBS.
For the first time, an instrument for investing in German mid caps, one with double inverse leverage on the S&P500, one on active management of liquidity denominated in dollars, one on low volatility and high dividend yield European securities and two ETFs on indices of Japanese companies with low volatility, as well as Etn (Exchange traded notes) leveraged on the Vix (volatility index), short and long leveraged on emerging equity markets.
Leader in Europe
Piazza Affari confirmed its leadership at European level for the number of contracts on the electronic platform with a share of 31,97%. On average, 23.334 were concluded every day against around 16 for Deutsche Boerse, which ranks second.
But what are the trends of the ETF industry emerging in Europe? According to Morningstar statistics, the first four months of 2016 were characterized by the success of specialized fixed income products, which received net flows of €11,64 billion, of which €3,69 in April alone. Conversely, index-linked stocks suffered net redemptions of 4,86 billion, of which 1,32 last month, despite the recovery of the stock exchanges. The second best asset class was that of raw materials (+5,57 billion in net flows since January), thanks in particular to the rediscovery of gold as a safe haven from market volatility.
Backfire
“As we look deeper into the Morningstar categories, we find that until recently unpopular products are back on the shopping list of European investors,” said Ali Masarwah, research editor at Morningstar. “Top of the list are US large-cap blend equity ETFs, emerging equity and euro corporate bonds (including high yield). Emerging Local Currency Fixed Income has also been very successful.”
On the other hand, the categories in great demand in 2015 suffered, such as equities in the euro area, Germany and Japan; as well as index-linked government bonds in euro and diversified bonds in dollars.
