Defensive ETFs flourish through volatile January
Defensive exchange traded funds (ETFs) are minimising the impact of market volatility, as investors look for alternative opportunities, robo-advice provider, Stockspot believes.
In its February ETF update, Stockspot reported that January 2016 saw volatility and share market falls across the globe which led to the first negative month of ETF funds under management (FUM) growth since August 2015 (falling four per cent), while the commodities sector had the highest monthly increase in FUM largely due to a 10 per cent rise in the gold price.
"Inflows into the fixed income and cash sector also highlights risk aversion during January," the report said.
"BetaShares' Australian High Interest Cash ETF (AAA) added $50M of new FUM.
"Other Australian bond ETFs, including IAF, RSM and VAF also received over $10M of new FUM each during January."
While there were declines in FUM at the very top end of the ETF market, ETF Securities, saw a 10 per cent surge in FUM, despite the market volatility, UBS suffered the biggest percentage hit to its FUM, dropping 26 per cent
AUTHOR
Nicholas O'Donoghue
Recommended for you
Betashares chief executive, Alex Vynokur, has said that the firm is focused on financial advisers “more than ever” as it grows the business, having announced a merger with managed account provider InvestSense.
L1 Capital has confirmed it intends to vote against the conversion of the Platinum Capital LIC into a listed ETF, meaning the deal “has a high probability of failing” due to L1’s substantial shareholding.
Pinnacle Investment Management has continued its focus on international expansion with the appointment of a managing director from T. Rowe Price.
Financial research firm Wealth Data, which publishes the weekly financial adviser numbers, has been sold to fintech firm Padua Solutions.
