ETFs: “People no longer buying everything blindly”
Increased turnover, many purchases, but increasingly also profit-taking characterize the picture in the ETF segment. European index funds are traded much more frequently.
11 February 2025: ETF traders on the Frankfurt Stock Exchange are reporting “good” or even “slightly higher” turnover in the current environment. In general, buying interest is predominant, but profit-taking is also increasingly being observed. “Traditionally, there is always something in the global index funds,” explains Ivo Orlemann from ICF Bank. The Invesco MSCI World (IE00B60SX394) is particularly in demand. Among the US index funds, the MSCI USA ESG (IE000QQ8Z0D8) stands out. Frank Mohr from Société Générale sees “decent buying interest” here. The SPDR S&P 500 Spider (IE00B6YX5C33), which is perceived as very attractive in terms of costs, is also almost traditionally at the top of the shopping lists.
Change of favorites for US index funds
Holger Heinrich from Baader Bank AG, on the other hand, has observed a change in investor behavior with regard to US ETFs. “Contrary to the past two weeks, the major indices are mainly being sold”. Specifically, he mentions the iShares S&P 500 ESG EUR Hedged (IE000CR7DJI8), the Xtrackers MSCI USA ESG (IE00BFMNPS42) and the Invesco EQQQ Nasdaq-100 (IE00BYVTMS52). Instead, we tend to buy sector ETFs such as the WisdomTree US Quality Growth (IE000YGEAK03). The stocks represented here contain certain quality and growth characteristics and are filtered according to ESG criteria. The Xtrackers MSCI Canada Screened (LU0476289540) is also in demand.
Europe and Germany: Increased activity
Heinrich is not the only one to report noticeably more active trading in European ETFs. “Here, too, the major indices tend to be sold”. On the sell side are the Amundi MSCI Europe II (FR0010261198) and the Amundi STOXX Europe 600 ESG II (DE000ETF9603). The Amundi IBEX 35 (FR0010655746) and the Xtrackers MSCI Nordic (IE00B9MRHC27) were bought. Mohr reports “strong purchases” of the iShares MSCI EMU ESG Enhanced (IE00BHZPJ015). According to Heinrich, the Amundi TecDAX (DE000ETF9082) is on the buy list in Germany, while Orlemann sees great interest in the Deka DAX (DE000ETFL011).
Several profit-takings in the tech sector
The technology sector remains in demand in the sector ETF segment. “However, not everything is being bought blindly anymore,” Mohr qualifies. The trader is also increasingly registering profit-taking, especially in the index funds that have recently been in regular demand. These include Xtrackers Artificial Intelligence & Big Data (IE00BGV5VN51) and Invesco US Technology Sector (<IE00B3VSSL01>). Other sectors are moving somewhat more into focus. ICF Bank's clients primarily collect shares in VanEck Defense (IE000YYE6WK5), L&G Cyber Security (IE00BYPLS672) and VanEck Semiconductor (IE00BMC38736). At Baader Bank it is the iShares US Medical Devices (<IE00BMX0DF60>). Mohr sees stronger purchases of the iShares STOXX Europe 600 Construction & Materials (DE000A0H08F7), which includes shares from the European construction and materials sector.
Sell-off of bond ETFs
In the bond segment, overnight trackers - for example (LU0290358497) - are still in demand, which Mohr also attributes to increasing activity from online brokers. Otherwise, the majority of US bonds in particular are being sold. Both short-dated bonds such as the Amundi US Treasury Bond 0-1Y (LU2182388749) and securities with somewhat longer residual maturities such as the iShares USD Treasury Bond 3-7yr (IE00B3VWN393) are being sold. Mohr also sees “a few losses” in the corporate bond segment (IE00B3F81R35).
By Thomas Koch, 11 February 2025, © Deutsche Börse AG
About the Author
Thomas Koch is a CEFA investment analyst, investment specialist for structured products and certified certificate consultant. He has been a freelance journalist covering events on the capital markets since the beginning of 2006.
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