ETF Stats for April 2017: Closing In On $3 Trillion

Sixteen launches and six closures pushed the quantity of active listings to 2,004 at the end of April, consisting of 1,812 exchange-traded funds (“ETFs”) and 192 exchange-traded notes (“ETNs”). Assets grew by 2.4% and now stand at $2.86 trillion. Inflows were strong at $38.5 billion for the month, pushing the year-to-date figure to $162 billion.

Asset growth for the year now totals $320 billion, with 50.8% coming from inflows and the other 49.2% produced by market gains. In the absence of a market correction, U.S. ETF industry assets should surpass the $3 trillion mark this year. Less than 5% additional growth is all that is needed.

Product count surpassed 2,000 in April, surpassing another major industry milestone. This month’s introductions included 10 smart-beta products, four actively managed ETFs, and only two ETFs tracking traditional capitalization-weighted benchmarks.

Trading activity declined sharply for the month, with dollar volume showing a 21.2% drop to $1.37 trillion. This puts the monthly asset turnover ratio at 48.0%, its second-lowest level of the past five years.

ETF Stats table for April 2017

New products launched in April (sorted by launch date):

1. NuShares Enhanced Yield 1-5 Year U.S. Aggregate Bond ETF (NUSA), launched 4/3/17, seeks to track the BofA Merrill Lynch Enhanced Yield 1-5 Year US Broad Bond Index. The smart-beta ETF uses a rules-based methodology that allocates higher weights to securities and sectors that have the potential for higher yield while maintaining comparable risk. It has a current yield of 2.0% and an expense ratio of 0.20% (NUSA overview).
2. Cambria Tail Risk ETF (TAIL), launched 4/6/17, is an actively managed ETF that intends to invest in a portfolio of out-of-the-money put options purchased on the U.S. stock market. The strategy offers the potential advantage of buying more puts when volatility is low and fewer puts when volatility is high. While a portion of the fund’s assets will be invested in the basket of long put options, the majority of fund assets will be invested in intermediate-term U.S. Treasurys. Since the fund is designed to be a hedge against market declines and rising volatility, Cambria expects the fund to produce negative returns in most years with rising markets or declining volatility. The expense ratio is 0.59% (TAIL overview).
3. PowerShares S&P 500 Value With Momentum Portfolio (SPVM), launched 4/6/17, tracks the performance of stocks in the S&P 500 Index that have the highest value and momentum score. Constituents are selected through a two-step process. First, the 200 stocks with the highest value scores are isolated. Then, the 100 securities with the highest positive momentum scores among these 200 are included in the portfolio. Its expense ratio is 0.30% (SPVM overview).
4. PowerShares S&P SmallCap Quality Portfolio (XSHQ), launched 4/6/17, tracks an index of 120 securities in the S&P SmallCap 600 Index that have the highest quality score, which is calculated from the average of three fundamental measures: return on equity, accruals ratio, and financial leverage ratio. It has an expense ratio of 0.29% (XSHQ overview).
5. JPMorgan Global Bond Opportunities ETF (JPGB), launched 4/7/17, is an actively managed ETF designed to deliver total return from a global, diversified bond portfolio that invests in bond and currency sectors across developed and emerging markets without benchmark constraints. It intends to dynamically shift sector and duration exposure in response to changing market conditions. Currency holdings can be for direct exposure or hedging purposes. The expense ratio is capped at 0.55% (JPGB overview).
6. EquityCompass Risk Manager ETF (ERM), launched 4/11/17, is an actively managed ETF sponsored by First Trust with an objective to provide long-term capital appreciation with capital preservation as a secondary objective. It will invest in equity securities of U.S. companies. When the U.S. equity market is determined to be unfavorable, it may invest all or a portion of its assets in cash, cash equivalents, and short-term fixed income. The expense ratio is 0.65% (ERM overview).
7. EquityCompass Tactical Risk Manager ETF (TERM), launched 4/11/17, is an actively managed ETF sponsored by First Trust with an objective to provide long-term capital appreciation with capital preservation as a secondary objective. It will typically invest in equity securities of U.S. companies. When the U.S. equity market is determined to be unfavorable, it may invest all or a portion of its assets in cash, cash equivalents, short-term fixed income, and securities designed to provide short exposure to the broad U.S. market. The expense ratio is 0.65% (TERM overview).
8. iShares iBonds Dec 2023 Term Muni Bond ETF (IBML), launched 4/13/17, seeks to track the investment results of an index composed of investment-grade U.S. municipal bonds maturing after December 31, 2022, and before December 2, 2023. It has an expense ratio of 0.18% (IBML overview).
9. SerenityShares Impact ETF (ICAN), launched 4/13/17, seeks to track the SPADE IMPACT Index—a passive, rules-based methodology to identify U.S.-listed companies whose businesses operate in areas that address the needs of society and the planet. Its expense ratio is 0.50% (ICAN overview).
10. VictoryShares Dividend Accelerator ETF (VSDA), launched 4/18/17, tracks the Nasdaq Victory US Multi-Factor Minimum Volatility Index. It offers exposure to large-cap U.S. stocks that feature a history of increasing dividends and possess the highest probability of future dividend growth. VSDA caps its expense ratio at 0.35% (VSDA overview).
11. ETF Industry Exposure & Financial Services ETF (TETF), launched 4/20/17, is designed to provide exposure to U.S.-listed companies that derive revenue from the ETF ecosystem. Constituents range from fund sponsors to index and data companies, trading and custody platforms, liquidity providers, and exchanges. A more detailed review can be found in my ETF Industry ETF It has an expense ratio of 0.64% (TETF overview).
12. Credit Suisse X-Links Crude Oil Shares Covered Call ETN (USOI), launched 4/26/17, is an ETN linked to an index that implements a “covered call” investment strategy. The underlying index maintains a notional long position in shares of the United States Oil Fund ETF (USO), while notionally selling call options on that position on a monthly basis that are approximately 6% out-of-the-money. The ETN has an annual investor fee of 0.85% (USOI overview).
13. iShares MSCI Argentina and Global Exposure ETF (AGT), launched 4/27/17, seeks to track the investment results of a broad-based index with exposure to Argentina, as defined by the index provider. MSCI classifies Argentina as a Frontier Market, but MSCI is reviewing it for possible promotion to Emerging Market status. AGT has an expense ratio of 0.59% (AGT overview).
14. Franklin LibertyQ U.S. Equity ETF (FLQL), launched 4/28/17, seeks to track the LibertyQ U.S. Large Cap Equity Index of U.S. mid- and large-capitalization companies that have favorable exposure to four investment style factors: quality, value, momentum, and low volatility. FLQL caps its expense ratio at 0.25% (FLQL overview).
15. Franklin LibertyQ U.S. Small Cap Equity ETF (FLQS), launched 4/28/17, seeks to track the LibertyQ U.S. Small Cap Equity Index of U.S. small-capitalization companies that have favorable exposure to four investment style factors: quality, value, momentum, and low volatility. FLQS caps its expense ratio at 0.35% (FLQS overview).
16. Franklin LibertyQ U.S. Mid Cap Equity ETF (FLQM), launched 4/28/17, seeks to track the LibertyQ U.S. Mid Cap Equity Index of U.S. mid-capitalization companies that have favorable exposure to four investment style factors: quality, value, momentum, and low volatility. FLQM caps its expense ratio at 0.30% (FLQM overview).

Product closures in April and last day of listed trading:

1. Direxion Daily Cyber Security & IT Bear 2x (HAKD), 3/31/17
2. Direxion Daily Pharmaceutical & Medical Bear 2x (PILS), 3/31/17
3. Direxion Daily Pharmaceutical & Medical Bull 2x (PILL), 3/31/17
4. PIMCO Diversified Income Active (DI), 3/31/17
5. PIMCO Global Advantage Inflation-Linked Bond Active (ILB), 3/31/17
6. AdvisorShares Athena High Dividend (DIVI), 4/3/17

Product changes in April:

1. Direxion Daily Junior Gold Miner Index Bull 3x Shares (JNUG) suspended creations effective April 13 due to “limited availability of certain investments or financial instruments used to provide exposure” to the underlying MVIS Global Gold Miners Index. This action makes JNUG a broken product.
2. Direxion Daily Junior Gold Miner Index Bull 3x Shares (JNUG) resumed accepting creation orders effective April 24.

Announced product changes for coming months:

1. AdvisorShares Global Echo (GIVE) and AdvisorShares Morgan Creek Global Tactical (GTAA) will close, with 5/12/17 being their last day of trading.
2. Deutsche X-trackers to close five currency-hedged ETFs, with 5/15/17 expected to be the last day of trading for DBAU, DBSP, DBRE, DBIG, and JPNH.

Previous monthly ETF statistics reports are available here.

Disclosure: Author has no positions in any of the securities, companies, or ETF sponsors mentioned. No income, revenue, or other compensation (either directly or indirectly) is received from, or on behalf of, any of the companies or ETF sponsors mentioned.

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