Biggest 2013 ETF Launches Tell New Tales

November 14, 2013

2013's biggest launches tell us droves about how the ETF industry is changing.

The number of ETF rollouts so far this year, 144, looks to be on pace to match 2012's 168 launches, but, more to the point, the top 10 launches list by assets gathered is truly a reflection of where the ETF industry finds itself in terms of diversity of products and even the growing importance of distribution.

These days, all the product-development trends that ETF pundits talk about are right there on the list—from enhanced beta; leverage; relatively expensive active funds; the quest for decent and dependable yield; as well as the ongoing success of low-cost provider Vanguard; and even a trio of ETNs.

"It's not so much of a list of pioneering strategies as it is a list that's about filling in the cracks," said Paul Baiocchi, a senior ETF analyst at IndexUniverse, referring to how this year's top 10 list shows that a blockbuster in 2013 isn't the same as a blockbuster in 2012 in terms of assets gathered and specific strategies.

Before diving in, it's worth noting that looking at assets under management as the qualifier may not be totally fair, as an attractive strategy that launched early in the year would make it onto the list more readily than a fund that launched two weeks ago.

That said, the No. 5 security on the list literally launched two weeks ago—which is related to why the Nos. 1 and 2 securities are even on the list as well.

We'll start by laying out all of the Top 10 funds in the table below.

Biggest 2013 Launches By AUM And Dates

Fund Name Symbol Issuer Expense Ratio AUM Launch
Barclays ETN+ FI Enhanced Global High Yield ETN FIGY Barclays Capital 0.80% $1,337,311,816 22/05/2013
Barclays ETN+ FI Enhanced Europe 50 ETN FEEU Barclays Capital 1.00% $970,455,243 23/05/2013
Vanguard Total International Bond BNDX Vanguard 0.20% $676,083,233 04/06/2013
SPDR Blackstone/GSO Senior Loan SRLN SSgA 0.90% $559,660,035 03/04/2013
Vident International Equity VIDI Exchange Traded Concepts 0.75% $260,164,159 29/10/2013
iShares MSCI USA Quality Factor QUAL BlackRock 0.15% $187,981,998 18/07/2013
iShares MSCI USA Momentum Factor MTUM BlackRock 0.15% $172,644,755 16/04/2013
iSharesBondTM 2018 Corporate ex-Financials Term IBCC BlackRock 0.10% $171,049,769 17/04/2013
Barclays ETN+ Select MLP ETN ATMP Barclays Capital 0.95% $167,703,679 13/03/2013
Cambria Shareholder Yield SYLD Cambria 0.59% $165,126,000 14/05/2013

'Bespoken' Launches

Again, the top two securities aren't even funds; rather, they're ETNs, which are debt obligations packaged in shares and traded like ETFs, on an exchange. The two ETNs are:

  • No. 1: Barclays ETN+ FI Enhanced Global High Yield ETN (FIGY), launched on May 22, now with $1.26 billion in assets
  • No. 2: Barclays ETN+ FI Enhanced Europe 50 ETN (FEEU), launched on May 23, now with $926 million in assets

These top two launches are "bespoken," meaning they are securities that are designed with a specific client in mind. In this case, the client is San Mateo, Calif.-based money manager Ken Fisher, who, it seems, is allocating shares of these double-exposure ETNs to client portfolios. This ETN was distributed even before the first share changed hands.

"What's becoming more important than the mousetrap is where you put the mousetrap," Dave Nadig, president of ETF Analytics at IndexUniverse, said in a recent podcast about the growing importance of distribution in the ETF industry.

It's worth noting that the creation of bespoken securities definitely seems to be a trend now, but so too are the underlying strategies Fisher asked the ETN backer Barclays Bank Plc to isolate—namely, leverage; the quest for yield; and the slow resurgence of Europe after its debt crisis.

 

 

 

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