ETF FYI: Defiance poaches CIO, Goldman gets physical, an Ethereum ETF

ETFs continue to have a record-breaking year, with November ranking as their best ever month for flows. 

The vehicles took in $97bn last month, according to Morningstar, beating their previous monthly record – $62bn in June 2019 – by some $35bn. 

And the records do not stop there. It has also been a banner year for ESG ETFs, with data from FactSet showing that investors piled $27.4bn into these funds, doubling their size. The influx was first reported by the Wall Street Journal. 

Display of Defiance

In other news, a high-profile ETF move hit the headlines. ETF industry veteran Sylvia Jablonski left her role as manager director at Direxion ETFs to join Defiance ETFs as CIO. Defiance is a relative newcomer to ETFs – the firm launched in 2018 with a focus on thematic funds.

Going for gold

Goldman Sachs Asset Management made its first push into physical gold ETFs, taking over the Perth Mint Physical Gold ETF (AAAU). The fund was originally backed by Australia’s Perth Mint and allowed investors to redeem for physical gold. Going forward, the fund will be operated by GSAM and no longer backed by the Perth Mint. With the transition, investors will no longer be allowed to redeem for physical gold. 

SPAC for that 

Tuttle Tactical Management’s SPAC and New Issue ETF (SPCX) has launched on the NYSE. SPCX is the first actively-managed ETF to provide access to the SPAC market. It differs slightly from the Defiance NextGen SPAC Derived (SPAK), which takes a passive approach to the SPAC market. Unlike SPAK, SPCX will move actively in and out of investments rather than relying on a rules-based index.

Global growth

First Trust has launched the First Trust International Developed Capital Strength ETF (FICS). The fund will follow the International Developed Capital Strength index, which tracks global companies that exhibit balance sheet strength and have a high likelihood of long-term growth. The fund has a tilt toward quality.

‘2020 has been a reminder of the importance of quality for navigating uncertain times. In our view, this applies just as much for international stocks as it does for US stocks,’ said Ryan Issakainen,  ETF strategist at First Trust.

Crypto ETFs 

The first Ethereum ETF has launched on the TSE. 3iQ’s Ether fund (QETH.U) will provide investors exposure to Ethereum cryptocurrency and is the first Ethereum ETF in the world. The fund is also notable because it could serve as a proof of concept for American regulators which have so far said no to crypto ETFs. 3iQ is Canada’s largest digital asset manager. The fund is backed by Ethereum coins being held by Gemini Custody, the custodial arm of Gemini crypto exchange.