ESG or SRI ETFs, hydrogen or battery ETFs - sustainable products are becoming increasingly popular. The recent price setbacks on the stock markets do not play a major role.
23 November 2021. Frankfurt (Börse Frankfurt).
ETF investors are not easily deterred by the current price losses on the stock market. "We are not seeing any major trades," notes Carsten Schröder of Société Générale. It is also rather quiet, he adds. "The Thanksgiving holiday in the U.S. on Thursday is making itself felt." Hubert Heuclin of BNP Paribas reports still high inflows into equity ETFs, "as always in the last twelve months." The DAX fell back below the 16,000-point mark today. On Tuesday morning, the index stands at 15,921 points, about 300 points below the all-time high last week.
US stocks of large and also smaller companies are doing well - often also with a good ESG profile. Schröder says investors like to back the Amundi S&P 500 (LU1681048804), while Heuclin says investors like to back the Amundi I.S.S&P 500 (<LU1681049018>), the CSIF MSCI USA Small Cap ESG Leaders Blue (IE00BMDX0L03), the iShares Core S&P 500 (IE00B5BMR087) and the Xtrackers Russell 2000 (IE00BJZ2DD79). U.S. value stocks, on the other hand, are being dumped, according to Schröder (IE00BD1F4M44).
China? Sustainable please
"Go Green" is once again the motto among investors looking to invest in Europe, according to Heuclin: Investors' shopping lists include the Amundi MSCI Europe SRI (LU1861137484) and the Lyxor Net Zero 2050 S&P Eurozone Climate PAB (LU2195226068).
Heuclin
"As for China, sales are down," Heuclin also notes. Investors were buying Amundi MSCI China ESG Leaders Select (<LU234399748>), for example. But also popular, he says, is Amundi MSCI Emerging ex-China Region ESG Leaders Select (LU2345046655), which provides access to emerging market stocks with high ESG profiles and explicitly excludes China stocks.
Hydrogen and batteries - sectors of the future
Also doing extremely well at the moment is a hydrogen ETF, as Torben Bendt of Lang & Schwarz reports, namely VanEck Vectors Hydrogen Economy (IE00BMDH1538). The ETF, which was only launched in March of this year, has recently performed very well after a rather disappointing start. Many are also buying WisdomTree Battery Solutions (IE00BKLF1R75), he said. BNP Paribas clients like to back the iShares Automation & Robotics (IE00BYZK4552).
Oil and gas stocks (DE000A0H08M3), on the other hand, which had been doing very well for a long time, are flying out of portfolios, traders note. High turnover is - as so often - also observed in bank ETFs (DE0006289309). "There is bought or sold depending on the news situation," notes Schröder.
Bonds: Prefer corporate bonds to government bonds
Bond ETFs are also seeing bottom-line inflows, albeit to a lesser extent than equity ETFs. This time, it is mainly "normal" corporate bonds, but also high yield bonds that investors are interested in - from the eurozone, the US or international. Heuclin reports inflows into iShares Core EUR Corp Bond (IE00B3F81R35) and Xtrackers II EUR Corporate Bond (LU0478205379), Schröder into iShares USD High Yield Corp Bond (IE00B4PY7Y77). In contrast, Société Générale clients said goodbye to iShares USD Corp Bond (IE0032895942) and emerging market bonds denominated in U.S. dollars (<E00B2NPKV68>).
"Fallen angels" bonds are also in demand, Heuclin reports. One example is the iShares Fallen Angels High Yield Corp Bond (IE00BYM31M36). That's up 10.8 percent year-to-date and 11.6 percent for the year over three years.
"Fallen angels" are bonds with an original investment grade rating that have been downgraded. On a risk-adjusted basis, "fallen angels" often show better returns than traditional high-yield bonds. The reason for this is that investors usually start to have doubts about the credit rating before the downgrade, and prices fall. The actual downgrade to high yield often marks a low point.
Cryptos: focus on Cardano and Solana.
Trading volume in cryptocurrency ETNs remains high, as Torben Bendt notes. "Right now it's more buying." The 21Shares Cardano (CH1102728750) and 21Shares Solana (CH1114873776) are particularly sought after, he said. Bitcoin had climbed to a new all-time high of $68,764 two weeks ago, but is now back down to $56,563.
There are now 24 crypto ETNs listed on the Frankfurt Stock Exchange. The largest in terms of accumulated assets are BTCetc - ETC Group Physical Bitcoin (DE000A27Z304), 21Shares Bitcoin (CH0454664001) and CoinShares Physical Bitcoin (GB00BLD4ZL17).
Shares | |
USA | Buys |
World | Buys |
Europe | Buys |
China | Buys |
Industries | |
Oil and Gas | Sales |
Hydrogen | Buys |
Battery production | Buys |
Bonds | |
High Yield | Buys |
Cryptocurrency-ETNs | Buys |
by Anna-Maria Borse, 23 November 2021, © Deutsche Börse AG