Elon Musk might launch an ETF business

This week we saw a number of ETF managers break through various AUM milestones which is obviously good news for them and a sign the industry is motoring. And it got me thinking, what could Elon achieve if he launched his own ETF business?

As we know the man is a disruptor, so could he disrupt ETFs and would he see enough of an opportunity right now?

If we are honest, the vast majority of products are me too versions and most innovation is just a slight enhancement of an old idea, I mean are ETF share classes ground shattering innovative or a tweak of existing tech?

His track record doesn’t point to too much tweaking so I’d bet on a big bang approach. Just want that big bang would be is something I’ll have to ask him next time he comes around for tea.

LAUNCHES THIS WEEK

After a few quite weeks the ETF product development machine is back up and running with a burst of activity this week

FLOWS & PERFORMANCE

Bitcoin an Ether ETFs in Hong Kong have suffered net outflows of $94m since launch at the beginning of May. Looks like Asian investors have a different perception of the products than those in the US.

Last week I mentioned the best performing fund of the year was the Jersey domiciled WisdomTree Cocoa. This week the fund is down 17%. Talk about the kiss of death.

Listen and learn

A podcast series focused on exploring the career journey of industry leaders within the ETF and Digital Assets space. Get to hear their personal story and be inspired.?This week we hear from Alex Levis, Founder of Arro Financial Communications.?In this conversation Alex talks about:

• Why taking a call from a headhunter lead to her start in ETFs
• Why coming from a family of entrepreneurs drove her to starting her own firm
• Why being a perfectionist is a burden she somehow has to bear

THINGS OF INTEREST

VanEck in Europe hit $10bn AUM. It seems like only yesterday that a small ETF manager called ThinkETF was bought by VanEck and VanEck Europe was born. $10bn later the firm goes from strength to strength. To hear the story of that growth listen to my podcast with Europe CEO Martijn Rozemuller link

?On the subject of milestones, HSBC have broken through the $100bn AUM barrier for their ETF and Indexing business. This is a whopping 181% increase since 2109 when the firm hired Nicolas Moreau as CEO. You gotta give it to the man, he’s certainly delivered the goods. Just goes to show what happens when you really focus on something. Kudos

?And to keep things going, Morgan Stanley Investment Management’s ETF AUM crossed the $2 billion mark as of May 7, a milestone achieved less than two months after MSIM’s ETF assets surpassed $1 billion and a little more than a year after its ETF platform was launched. Anthony Rochte and team are on a roll.

?Interesting revenue analysis for the guys at Bloomberg. Everyone always gets so focused on AUM but its revenue that’s the real key business metric

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Are you interested in Spain? And not just for your holidays. We recently produced a report on the Spanish ETF market, quite often the forgotten country when it comes to ETF investing in Europe. Some interesting facts for you.

·????? The Spanish asset management market is estimated to have approximately $450 billion total assets under management (AUM).

·????? Of this approximately $80bn is held in ETFs and $11bn in index mutual funds.

·????? The largest ETF investor segment is Fund of Funds

·????? Banks dominate distribution, CaixaBank, BBVA, and Santander, which together control about 75% of the total market share.

·????? Unlike every other country in Europe investors do not trade on the Madrid exchange, preferring Xetra or wherever platform has the best liquidity

If you would be interested in the report let us know.

Last week’s 13F filing of spot Bitcoin ETFs in the US showed there were 937 professional firms invested in the first quarter, representing 19% of all Bitcoin ETFs aum. The remaining 81% was held by Retail. An interesting comparison from Bitwise shows how this compared to Gold ETFs in their first quarter. Link

CAREER CORNER

?Movers and Shakers

• Vanguard?has hired former?BlackRock?executive Salim Ramji as CEO
• Grayscale has appointed Goldman Sachs executive Peter Mintzberg as its new Chief Executive Officer. Mintzberg succeeds Michael Sonnenshein, who has stepped down from the position to pursue other interests, the company said.
• Paul Spells has joined Ark Invest as head of Northern Europe
• Ciaran Fitzpatrick is leaving State Street to pursue new opportunities. After 21 yrs at the firm it was time for a change I guess
• ?Ben Crook has joined Grayscale from Tema as West Coast sales from Tema
• Chris Makowski has joined Charles Schwab as Manager, ETF Capital Markets

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Salary Trends

Some more stats from our 2024 ETF Salary survey

·????? The US is the country paying the highest compensation, on average 45% higher than in Europe and 28% than in Asia

·????? The highest paying roles are those within Trading, on average paying $393k.

·????? The lowest paying roles are Operations, on average paying $141k.

Tip of the week

As told by recent podcast guests

1. Be intellectually curious - Your company will love it and it's a great way to develop meaningful relationships with people

2. Don't take things so personally - People generally don't mean it and you will be a lot happier if you just let it go

3. Take more risks - If you don't try, you won't know, and no one wants to live a life full of regrets

Blackwater is a leading global ETF Consulting, PR, Content Creation and Talent Management firm. We are specialists in helping companies find the best strategy to enter and navigate the ETF marketplace, enhance their reputation, craft innovative and engaging targeted ETF content and source the very best of talent across the ecosystem. If you would like to discuss any of the above, reach out to [email protected].