Two large European pension funds have announced that they are to use Russell benchmarks as the basis for investment strategies, amidst growing institutional interest in passive investing using alternative indices.
The Danish Teachers’ Pension Fund (Laerernes) says it has invested approximately €120 million (US$155m) in a fund tracking the Russell fundamental emerging markets large company index, the first time the pension fund has used an alternative index strategy.
Inflows into the global exchange-traded fund have boomed in September as investors return to equities.
Data from BlackRock show that net new global inflows into ETFs and exchange traded products reached US$43.3bn in September, the highest single month total since December 2008.
According to BlackRock, the surge was driven by announcements of new asset purchases from the European Central Bank, the US Federal Reserve and the Bank of Japan.
The exchange-traded market is likely to be one casualty of the European Parliament's decision to allow financial advisors to continue taking commissions.
iShares has launched the first global corporate bond ETF in Europe as investors continue to look to the fixed income sector for yield.
The iShares Global Corporate Bond ETF has been listed on the London Stock Exchange under the ticker “CORP”. The fund’s base currency and currency of trading are both US dollars, although the ETF invests in bonds denominated in 15 currencies.