Stumbling Across the Finish Line
The S&P 500 notched a new all-time high in July before taking a nose dive during the last few trading days of the month and finishing 1.38% lower than where it began the third quarter. Some of the hardest hit segments of the market such as small caps and utility stocks were also amongst the most richly priced at the month’s onset. The ETF asset flows picture was mixed. U.S. equity and emerging-markets ETFs saw sizable inflows, amassing a respective $9.8 billion and $3.4 billion in new investor capital. Meanwhile, high-yield ETFs experienced record redemptions of approximately $3.1 billion.
The single most significant bit of ETF industry news from the month of July was Capital Group’s filing for nontransparent actively managed ETFs. I share my thoughts on the matter in “Capital Group Bets on a Different Kind of Tech”. In sum, I see this as a wager on new distribution technology by a firm that has been bleeding assets because its existing distribution model is suffering.
I’d like to once again plug our fifth annual Morningstar ETF Conference. This year’s conference will be held from September 17-19 at the Chicago Sheraton. You can find additional details and the full conference agenda here. This year’s conference is shaping up to be our best yet—owing to a fantastic lineup of speakers and panelists. This year’s keynote and general session speakers include Nobel Laureate Eugene Fama, BlackRock’s Russ Koesterich, JP Morgan’s Dr. David Kelly, PIMCO’s Jerome Schneider, AQR’s Ronen Israel, and Wesley Gray of Drexel University. We hope to see you in Chicago in September for three days packed with valuable insights and investment ideas.
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