{"id":132220,"date":"2020-12-13T00:10:00","date_gmt":"2020-12-12T21:10:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/what-will-2021-bring-for-etfs\/"},"modified":"2020-12-13T00:10:00","modified_gmt":"2020-12-12T21:10:00","slug":"what-will-2021-bring-for-etfs","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/what-will-2021-bring-for-etfs\/","title":{"rendered":"#\n  What will 2021 bring for ETFs?"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3845ac3232f\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3845ac3232f\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/what-will-2021-bring-for-etfs\/#What_to_watch_everything_from_bitcoin_ETFs_to_a_B-minus_grade_for_%E2%80%98ANTs\" >What to watch: everything from bitcoin ETFs to a B-minus grade for \u2018ANTs\u2019<\/a><ul class='ez-toc-list-level-6' ><li class='ez-toc-heading-level-6'><ul class='ez-toc-list-level-6' ><li class='ez-toc-heading-level-6'><ul class='ez-toc-list-level-6' ><li class='ez-toc-heading-level-6'><ul class='ez-toc-list-level-6' ><li class='ez-toc-heading-level-6'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/what-will-2021-bring-for-etfs\/#Less_transparency\" >Less transparency<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-6'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/what-will-2021-bring-for-etfs\/#Direct_indexing\" >Direct indexing<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-6'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/buradabiliyorum.com\/en\/what-will-2021-bring-for-etfs\/#Themes_and_asset_classes\" >Themes and asset classes<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-6'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/buradabiliyorum.com\/en\/what-will-2021-bring-for-etfs\/#Regulation_and_policy\" >Regulation and policy<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-6'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/buradabiliyorum.com\/en\/what-will-2021-bring-for-etfs\/#When_will_ETFs_overtake_mutual_funds\" >When will ETFs overtake mutual funds?<\/a><\/li><\/ul><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/buradabiliyorum.com\/en\/what-will-2021-bring-for-etfs\/#Andrea_Riquier\" >Andrea Riquier<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong>#<br \/>\n  What will 2021 bring for ETFs?<br \/>\n<\/strong>&#8221;<\/p>\n<h2 class=\"article__subhead\" itemprop=\"alternativeHeadline\"><span class=\"ez-toc-section\" id=\"What_to_watch_everything_from_bitcoin_ETFs_to_a_B-minus_grade_for_%E2%80%98ANTs\"><\/span>\n  What to watch: everything from bitcoin ETFs to a B-minus grade for \u2018ANTs\u2019<br \/>\n<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><\/p>\n<div class=\"column column--full article__content\">\n<div id=\"js-article__body\" class=\"article__body article-wrap at16-col16 barrons-article-wrap\" itemprop=\"articleBody\" data-sbid=\"WP-MKTW-0000092657\">\n<div class=\"barrons-article-ad-wrapper\">\n<div data-track=\"barrons-article-ad-wrap\" class=\"barrons-article-ad sticky_item\">\n<div class=\"barrons-main-article-ad-target sticky_target body_ad\" aria-hidden=\"true\"><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<p>       In the final month of a year like no other, it\u2019s a bit humbling to try to forecast trends for 2021. Who among us had \u201cETFs will serve as proxies for stocks when circuit breakers close the market\u201d on their 2020 bingo cards, after all?<\/p>\n<p> Still, life goes on, and MarketWatch rounded up a few intrepid exchange-traded fund industry-watchers who were willing to offer predictions. There will be some continuity \u2014 as Amrita Nandakumar, president of Vident Investment Advisory put it, ETFs always have been about the democratization of finance, and that won\u2019t change. But there may be some shiny new advances as well. Bitcoin ETF, anyone?<\/p>\n<div class=\"paywall\">\n<h6><span class=\"ez-toc-section\" id=\"Less_transparency\"><\/span>Less transparency<span class=\"ez-toc-section-end\"><\/span><\/h6>\n<p> Active non-transparent (sometimes called \u201csemi-transparent\u201d) ETFs were a long-awaited industry development that finally came true in 2020. They purported to offer a proven ETF structure to active fund managers who thought they had a secret sauce to protect. It\u2019s an idea that some industry participants adore and others find silly -\u2013 and that bifurcation may stretch into 2021. <\/p>\n<p>Nandakumar views \u201cANTs\u201d as the very epitome of ETFs\u2019 democratization of finance, because they bring \u201csophisticated managers\u201d to the masses, with lower fees and tax efficiency. \u201cThere is renewed interest in active management in ETFs,\u201d she said \u2013- in both less-transparent and fully transparent forms. <\/p>\n<p>In contrast, Dave Nadig, chief investment officer and director<br \/>\nof research at ETF Database, gives ANTs\u2019 performance so far a \u201cB-minus. They\u2019re<br \/>\nin a steady state. They work. They\u2019re trading. Now the question is, does<br \/>\nanybody care? There isn\u2019t a lot of money chasing them,\u201d he told MarketWatch.<\/p>\n<p>Paul Kim, CEO and co-founder of Simplify Asset Management, sums it up this way: \u201cThis year has only put an exclamation point on the fact that ETFs are the way of the future. The jury\u2019s still out on whether some of the new entrants can translate their business to the ETF vehicle, and ANTs will be put to the test in the next few quarters.\u201d<\/p>\n<p>One of the biggest stories of 2020 was the blockbuster performance of one of the most transparent managers in the financial markets, Ark Invest\u2019s Cathie Wood. The company\u2019s flagship fund, the ARK Innovation ETF,<br \/>\n        ARKK,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/204808965\/composite\" class=\"negative\">-1.06%<\/bg-quote><br \/>\n       has gained 143% in the year to date, trouncing the 40% gain for the broad tech-oriented Nasdaq Composite Index<br \/>\n        COMP,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/210598365\/realtime\" class=\"negative\">-0.23%<\/bg-quote><span>.<\/span>\n       <\/p>\n<p>More opaque ETF strategies still may have a shot in the year ahead, Simplify\u2019s chief revenue officer, Brian Kelleher, said, even though questions remain. \u201cIs ANT going to be enough? Active managers have showed that full transparency works. If there\u2019s competition that\u2019s willing to be fully transparent, all else equal, I don\u2019t see why investors wouldn\u2019t go with that.\u201d<\/p>\n<p><strong>See also:<\/strong> Coronavirus was the perfect storm for tech innovation, and this fund manager made out <\/p>\n<h6><span class=\"ez-toc-section\" id=\"Direct_indexing\"><\/span>Direct indexing<span class=\"ez-toc-section-end\"><\/span><\/h6>\n<p> For all the discussion about what managers will choose to do, there\u2019s a much more seismic shift going on in the industry, one that keys in even more closely on the democratization trend Nandakumar references. It\u2019s the steady rise of direct indexing, which utilizes complex software to allow individual investors to essentially be their own portfolio managers. Each of the industry participants we spoke with have been watching closely as big players snatch up smaller ones with sought-after <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/technology\/\" data-internallinksmanager029f6b8e52c=\"4\" title=\"Technology\" target=\"_blank\" rel=\"noopener\">technology<\/a>.<\/p>\n<div id=\"cx-membership-tile\"><\/div>\n<p> \u201c<a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.wsj.com\/articles\/blackrock-to-buy-equity-index-provider-aperio-for-1-billion-11606173777\" class=\"icon none\">BlackRock buying Aperio<\/a> gives you a pretty clear sense of what\u2019s going on,\u201d Nadig said. \u201cI think we\u2019re in the stage of everyone recognizing it\u2019s a thing, and people scrambling to acquire. Now the question is, who\u2019s going to come out with something for consumers? I don\u2019t think it\u2019s a 2021 proposition, although it could be. It\u2019s just a matter of will.\u201d<\/p>\n<p>Direct indexing \u201cisn\u2019t an ETF killer,\u201d Nandakumar told MarketWatch. \u201cIt\u2019s a complement, and it won\u2019t be for everyone. I don\u2019t anticipate the typical investor will have the time or energy for it, but I think we\u2019re going to hear a lot about it. A lot of people will be trying to learn about it and figure out if it makes sense for them.\u201d<\/p>\n<p><strong>Read:  <\/strong>This innovation could do for investing what Napster and the iPod did for music \u2014 and financial services may never be the same <\/p>\n<h6><span class=\"ez-toc-section\" id=\"Themes_and_asset_classes\"><\/span>\n<strong>Themes and asset classes<\/strong> <span class=\"ez-toc-section-end\"><\/span><\/h6>\n<p> What ideas and sections of the market will investors seek<br \/>\nout next year?<\/p>\n<p>\u201cWe\u2019re already seeing the earliest move out of U.S. megacaps into essentially everything else,\u201d Simplify\u2019s Kim said in an interview. \u201cEmerging markets, international developed markets, small-caps, to some extent value. The question is, how much of a trend is it, or is it just a short-term reversion to the mean? If it\u2019s really a trend we could see the market drive much higher\u201d as previously unloved segments get some attention from investors. <\/p>\n<p>At the end of a year packed with <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">theme<\/a>s, from religion to biotech to funds that capture our brave new world, \u201chas theme fatigue started already, and if not, is it coming?\u201d Nandakumar asked. <\/p>\n<p>Theme investing is considered yet another democratizing tool, because it offers securities wrapped in a story that can make sense to retail investors. Still, \u201cin some cases it\u2019s not a real value add,\u201d Nandakumar said, adding that in every case, investors still must \u201clook under the hood\u201d to make sure the specific construction of the fund, not just the marketing, match their expectation. <\/p>\n<p><strong>See: <\/strong> Will mutual funds get a second wind\u2026 as ETFs? <\/p>\n<h6><span class=\"ez-toc-section\" id=\"Regulation_and_policy\"><\/span> Regulation and policy<span class=\"ez-toc-section-end\"><\/span><\/h6>\n<p> The appointment of a new chair for the Securities and Exchange Commission is \u201cthe biggest hanging chad\u201d in the market right now, Nadig said. \u201cWe\u2019re going to get somebody new which could open up some bottlenecks on things like a bitcoin<br \/>\n        BTCUSD,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/31322028\/realtime\" class=\"positive\">+0.73%<\/bg-quote><br \/>\n       ETF.\u201d<\/p>\n<p>Also worth keeping an eye on, Kelleher told MarketWatch, is whether the new administration, which may be more focused on raising tax revenue,  may favor some changes that make investing in ETFs less tax-friendly than they are now. <\/p>\n<p><strong>Read next:<\/strong>  ETF giants want better labeling. Not everyone is convinced  <\/p>\n<h6><span class=\"ez-toc-section\" id=\"When_will_ETFs_overtake_mutual_funds\"><\/span>When will ETFs overtake mutual funds?<span class=\"ez-toc-section-end\"><\/span><\/h6>\n<p> As MarketWatch reported last year, industry pioneer Nadig has been making the same stump speech since 2009. ETF assets under management will top those of mutual funds at some point. In 2009, his forecast \u201ccross-over\u201d date was 2025, but by 2019, thanks to the explosive popularity of ETFs, he moved his date up a year, to 2024. <\/p>\n<p>Call it another casualty of 2020: this year he\u2019s pushed \u201ccross-over\u201d <em>back <\/em>three years, to 2027.  <\/p>\n<p>What happened? \u201cTwo years of exceptional market moves,\u201d Nadig said. For incoming money flows, \u201cit\u2019s worse than ever for mutual funds,\u201d but if the market \u2014 mostly US-based equity funds<br \/>\n        SPX,<br \/>\n        <bg-quote field=\"percentchange\" format=\"0,000.00%\" channel=\"\/zigman2\/quotes\/210599714\/realtime\" class=\"negative\">-0.13%<\/bg-quote><br \/>\n       \u2014 churns 15-30% higher for two straight years, it hides the fact that mutual funds aren\u2019t just treading water, but losing 4-5% of their assets under management every year.  <\/p>\n<p>\u201cIt will take ETFs longer to catch up, because of compounding,\u201d Nadig said. \u201cNothing in the narrative changed but the market growth.\u201d<\/p><\/div>\n<\/div><\/div>\n<p><\/p>\n<div class=\"byline article__byline\">\n<p>      <span>By<\/span><\/p>\n<div class=\"author  hasMenu\" data-scrim='{\"type\":\"author\",\"header\":\"Andrea Riquier\",\"subhead\":\"The Wall Street Journal\",\"list\":[]}' itemscope itemprop=\"author\" itemtype=\"http:\/\/schema.org\/Person\">\n<h4 itemprop=\"name\"><span class=\"ez-toc-section\" id=\"Andrea_Riquier\"><\/span>Andrea Riquier<span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/p><\/div>\n<\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/news\/\" target=\"_blank\" rel=\"noopener\">News category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"http:\/\/www.marketwatch.com\/news\/story.asp?guid=%7B21005575-02D4-D4B5-4572-D169F1531F27%7D&#038;siteid=rss&#038;rss=1\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# What will 2021 bring for ETFs? &#8221; What to watch: everything from bitcoin ETFs to a B-minus grade for \u2018ANTs\u2019 In the final month of a year like no other, it\u2019s a bit humbling to try to forecast trends for 2021. Who among us had \u201cETFs will serve as proxies for stocks when circuit&#8230;<\/p>\n","protected":false},"author":1,"featured_media":132221,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[70897],"tags":[],"class_list":["post-132220","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/132220","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=132220"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/132220\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/132221"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=132220"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=132220"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=132220"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}