ETF Week: Vanguard, First Trust Funds Launch

Below is a roundup of the key developments in the ETF space during the week of Sept. 4, 2018:

Vanguard Launches Global Bond ETF
On Thursday, Vanguard rolled out the Vanguard Total World Bond ETF (BNDW), which tracks the performance of the Bloomberg Barclays Global Aggregate Float Adjusted Composite Index by investing in the Vanguard Total Bond Market ETF (BND) and the Vanguard Total International Bond ETF (BNDX).

The low-cost, one-stop shopping offered by the fund heralds a new opportunity for investors to construct cheaper and simpler ETF portfolios.

First Trust Debuts Momentum Factor Fund Trio
First Trust unveiled a trio of ETFs on Thursday that each target the momentum factor and another different factor. One is a renovation of an existing ETF, but the other two are brand-new products.

The new funds include:

• First Trust Dorsey Wright Momentum & Value ETF (DVLU)
• First Trust Dorsey Wright Momentum & Low Volatility ETF (DVOL)
• First Trust Dorsey Wright Momentum & Dividend ETF (DDIV)

Each targets 50 stocks based on their exposure to a specified factor as well as the degree of momentum they exhibit as measured by Dorsey Wright’s relative strength methodology.

Defiance Rolls Out First Quantum Computing ETF
Defiance ETFs broke new ground with Wednesday’s rollout of the first ETF to target the quantum computing space. The Defiance Quantum ETF (QTUM) covers about 60 companies that develop or use quantum computing, which essentially relies on fast computers to solve complex problems via quantum mechanics.

August Sees $25B In ETF Inflows
August was a solid month for U.S.-listed ETFs, which attracted a net of $25 billion in fresh net assets. The pace brought year-to-date ETF net creations to $173.7 billion for a total market size that now sits at $3.72 trillion.

The bulk of the new money landed in U.S. equity funds, such as the iShares Core S&P 500 ETF (IVV), the Invesco QQQ Trust (QQQ) and the Vanguard S&P 500 ETF (VOO). However, despite flagging performance in emerging markets, the fourth-most-popular ETF was the iShares Core MSCI Emerging Markets ETF (IEMG), which pulled in $1.5 billion.

Contact Heather Bell at [email protected]