They are usually just as popular as MSCI World shares: S&P 500 or MSCI USA trackers. However, they are currently more likely to be sold. Crypto ETF trading is also really busy. The reason: the approval of the Bitcoin ETF in the USA.
16 January 2024. FRANKFURT (Börse Frankfurt). The sideways movement on the equity markets is leading to rather quiet trading in equity ETFs. Frank Mohr from Société Générale speaks of a "completely normal week" with a slight buying overhang. Leo Puschmann from Lang & Schwarz also sees nothing special and reports buying and selling. The DAX has been hovering around 16,600 points for around a month, at midday on Tuesday the index stood at 16,520 points. The US stock markets have also been moving sideways for several weeks.
The focus in the equity ETF segment continues to be on MSCI World trackers. According to Mohr, purchases clearly predominate here, for example in the iShares Core MSCI World (IE00B4L5Y983). "However, it is noticeable that US equities (IE00B5KQNG97) tend to be sold." German equities are also being sold, for example with the iShares Core DAX (DE0005933931), while European equities are being bought.
Technology and healthcare stocks dominate the sector ETF business, as Mohr also notes. Xtrackers Artificial Intelligence & Big Data (IE00BGV5VN51) is always on the shopping lists, while iShares Automation & Robotics (IE00BYZK4552) is also in demand. Among healthcare stocks, the Invesco Nasdaq Biotech (IE00BQ70R696) is proving popular. Bank ETFs are also being bought more than usual at the moment.
Mohr
Money market trackers still very popular
According to Société Générale, money market and money market-related ETFs such as Lyxor Euro Overnight Return (FR0010510800) and Xtrackers II EUR Overnight Rate Swap (LU0290358497) continue to attract interest in bond ETFs. On the other hand, inflation-linked ETFs and Global Aggregate SRI ETFs, which track global bonds with an SRI filter, were "heavily sold".
Strong crypto trading after SEC approval
There was a lot going on in crypto ETFs, as Leo Puschmann reports. "We had an enormous amount of turnover, on both sides." All currencies were affected, especially Solana and Ethereum in addition to Bitcoin. The trigger: The US Securities and Exchange Commission (SEC) gave its approval for a Bitcoin spot ETF last Wednesday. The decision had been eagerly awaited, with speculation driving the price of Bitcoin to over USD 45,000 in the first week of January. Following the decision, however, the price initially fell, with Bitcoin trading at USD 42,700 on Tuesday afternoon.
The ETC Group Physical Bitcoin (DE000A27Z304), VanEck Bitcoin (DE000A28M8D0), WisdomTree Physical Bitcoin (GB00BJYDH287) and 21Shares Bitcoin (CH0454664001) are currently seeing a lot of movement. In other currencies, the ETC Group Physical Ethereum (DE000A3GMKD7) and 21Shares Solana Staking (CH1114873776) are currently particularly strong in terms of turnover.
No Bitcoin ETF in Germany
Apart from the impact on the price, the SEC decision has no relevance for Germany and Europe. There will be no Bitcoin ETF. The reason: regulation, specifically the UCITS (Undertakings for Collective Investment in Transferable Securities Directive). This prohibits funds, including ETFs, from only representing one product. The risk must be diversified. The alternative is crypto ETNs, which have long since established themselves here.
Unlike ETFs, ETNs are not special assets, but debt securities. As an investment, they are therefore associated with the risk that the issuer could default as a debtor. For this reason, ETN issuers often collateralize their products. All crypto ETNs tradable on Xetra are physically collateralized.
By Anna-Maria Borse, 16 January 2024 © Deutsche Börse AG
Anna-Maria Borse is a financial and business editor specializing in the financial market/stock exchange and economic topics.
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Borse