The big story for 2013 has been the relentless bull market that has pushed markets to continually hit new highs. The positive sentiment on Wall Street bled into the ETF industry, as a number of new funds were able to quickly gain the attention of investors and gather a significant amount of assets.
It seems that as the years go on, the ETF space gets more fleshed out and issuers turn to more unique products to slice-and-dice the universe in new and exciting ways. 2013 has certainly been no exception as there have been a number of ETF firsts throughout the year. But uniqueness does not guarantee the success of a fund, as there are some ideas with a solid investing thesis that simply fail to catch on with investors.
To get a better gauge for how 2013′s launches fared among the ETF world, we outline the 10 most successful new ETFs that hit the market this year:
The Barclays ETN+ FI Enhanced Global High Yield ETN (FIGY) has easily been the most successful new ETF of the year, as it has amassed more than $1.3 billion in assets – an incredible feat for a fund that debuted midway through the year. FIGY launched on May 22nd and was very quick out of the gate as investors were immediately drawn to its high yield strategy. Dividends and income have been a major investing theme over the past few years, as record low interest rates have forced investors to look elsewhere for income.
The Barclays ETN + FI Enhanced Europe 50 ETN (FEEU) launched alongside the first placed FIGY, with the fund setting its sights on European exposure. Like its peer, FEEU was quick to garner assets and now has just under $1 billion total, making it the second most successful launch of the year.
Vanguard struck gold with the Total International Bond ETF (BNDX, A). The fund debuted on June 4th and already has more than $700 million in assets, thanks to its unique strategy. The ETF invests in global non-U.S. debts, all of which are investment grade, giving investors exposure to debts all around the world. With the U.S. enduring a government shutdown and numerous debt ceiling debates, the trust that many investors held in U.S. debt has taken a bit of a hit, helping to propel this fund further. Finally, as Vanguard is known to do, BNDX charges a low, attractive fee of just 20 basis points.
State Street debuted the SPDR Blackstone GSO Senior Loan ETF (SRLN) on April 4th and watched the fund amass more than $570 million in assets over just a few months. What’s more, SRLN is an actively managed ETF, making its run higher all the more impressive; active products have been, for the most part, slower to catch on in the ETF world. The fund aims to provide its investors with income that’s consistent with the preservation of capital.
The International Equity Fund (VIDI) marked the first fund from Vident Financial. The ETF hit the market on October 29th and has already gained more than $360 million in assets. The fund invests in both developed and emerging economies and seeks to rebalance in order to emphasize those with favorable conditions and future prospects. You can learn more about the fund’s unique strategy and why investors have been so excited about the ETF on its fact sheet.
DBX Strategic Advisors rolled out the second fund to offer exposure to China A-shares with its Harvest CSI 300 China A-Shares Fund (ASHR). ASHR has collected $190 million in assets, but debuted just weeks ago on November 6th, making its run-up quite impressive. Already, ASHR has more than five times the assets of the competing A-shares ETF, PEK, boding well for this young fund.
On June 4th, ALPS introduced the Barron’s 400 ETF (BFOR), which employs an interesting strategy that struck a chord with investors. The fund chooses 400 of America’s most promising companies as measured by 24 separate indicators across growth, value, profitability and cash flow. The holdings are then equal weighted to ensure that no single company can dominate the fund. In under six months the fund is up to $181 million in assets, making it the sixth most successful ETF launched in 2013.
It should come as no surprise to see iShares make the list, as it is one of the biggest names in the ETF world. On April 19th, the firm released the iSharesBond 2018 Corporate ex-Financials Term ETF (IBCC) and watched the fund rake in about $171 million in assets. IBCC invests in corporate investment grade debt that matures between March 31, 2017 and April 1, 2018; all debts come from non-financial companies that have a market cap of at least $250 million. The ex-financial space has been hot ever since the 2008 crash, with a number of investors wishing to diversify away from that sector in order to protect against a similar market downturn.
The Barclays ETN+ Select MLP ETN (ATMP) joins a tight race with several new ETFs that have all amassed approximately $170 million in total assets. This fund rolled out on March 12th and offers exposure to the MLP space, another hot sector that investors have embraced due to the attractive yields that can be found there. ATMP specifically offers exposure to midstream MLPs in both the U.S. and Canada.
Cambria, another new issuer in 2013, makes its way onto the list with the Shareholder Yield ETF (SYLD). The fund launched on May 14th and has since gathered $169 million in total assets. SYLD also maintains active management, as the fund employs a quantitative strategy to pick U.S. firms that show strong characteristics in returning free cash flow to shareholders. This means that the fund picks out stocks that are likely to not only pay out strong dividends, but also engage in share repurchases, which seem to be appearing more and more as of late.
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Disclosure: No positions at time of writing.