ETFs: "Much more inflows into Europe's equities"

Europe's stock markets are not doing badly at all compared to the USA - on the contrary. Investors are positioning themselves accordingly. Quality and high-dividend stocks remain popular. The Bitcoin recovery is also attracting investors to crypto ETNs.

14 February 2023. Frankfurt (Börse Frankfurt). The buying mood in the ETF business continues. "Although it was the worst week of the year so far in the equity markets, we recorded around 60 percent more purchases than sales in our major ETFs," reports Holger Heinrich from Baader Bank. ESG products continued to be in particularly high demand, he said. "In addition, interest in quality and equity securities continues unabated."

Torben Bendt of Lang & Schwarz reports a conspicuous amount of buying for European equities - and good turnover overall. "Trading volume is much higher than two or three weeks ago." At midday Tuesday, the DAX is at 15,435 points, up 9.7 percent since the start of the year. The S&P 500 is up 8.2 percent this year.

Popular: "ESG Leaders" and "ESG Elite

According to Heinrich, the focus in U.S. equities is on sustainable index products. The SPDR S&P 500 ESG Leaders (IE00BH4GPZ28) and the UBS S&P 500 ESG (IE00BHXMHL11), for example, ended up in the portfolios. He also observes inflows for the SPDR S&P US Dividend Aristocrats ESG (IE00BYTH5R14) and the UBS S&P Dividend Aristocrats ESG Elite (IE00BMP3HG27). The latter two track high-dividend U.S. stocks that also do well from a sustainability perspective. Since the beginning of the year, however, the SPDR ETF has only gained a small 1 percent, while the UBS ETF has gained 5 percent.

Focus on quality

As for European equities, Lang & Schwarz is looking for the Lyxor Core Stoxx Europe 600 (LU0908500753), for example. "We are seeing a lot more inflows into European equities than usual, including products from other providers," explains Bendt. Heinrich reports buying for classic Stoxx Europe and Euro Stoxx trackers from iShares (IE0008470928) and Amundi (LU1681047319), as well as versions with sustainability filters such as iShares MSCI EMU ESG Screened (IE00BFNM3B99). "Also in demand are quality (IE00BYSX4176) and - again - dividend stocks (IE00BF2B0L69, LU0292095535)." Dealers report no abnormalities for the bond ETF business.