According to Tidal Research, exchange-traded fund (ETF) issuers pulled in a record $17 billion in expense ratio revenue over the past year, partly due to the increase in actively managed ETFs. Additionally, according to FactSet, US bond ETFs added $1.5 billion in a single day this week.
Tidal Financial Group chief investment officer Michael Venuto joins Catalysts to break down where investors are leaning amid rising risk appetite.
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According to title research, ETF issuers have brought in a record $17 billion in expense ratio revenue in the past year, in large part due to the rise of actively managed ETFs. At the same time, according to FactSet data, US bond ETFs added $1.5 billion in a single day this week. So, what will the majority of investors choose? Managed risks, or safety? I want to bring Michael Vanudo title Financial Group's chief investment officer for this week's ETF report, sponsored by Invesco, QQQ. Michael, great to speak with you. I'm so excited to get your take on this, because obviously $1.5 billion into bonds, seeing that safety catching a bid from investors, but you also point out in your notes here that investors are also seeking active and complex ETFs. Which one is getting more popular at this moment?
Yeah, so we've seen a lot of this. Um, our platform helps people launch, grow, and operate ETFs. So we're behind Tom Lee at Fundstrat, right? He came out with Granny Shots. It's raised almost a little over $900 million in six months, and it's very active, very concentrated. Um, we even saw Rockefeller, which is a client of ours as well, bring out two ETFs last year that were actively managed, and they did it through a tax-free conversion. Um, so that kind of stuff, people seem to have a risk appetite for.
And is that risk appetite indicating that maybe investors are a little bit more risk-on than we might think right now? Are investors more willing to, you know, buy any rally at this moment, or are they looking to sell that rally and seek safety?
So, I do see a lot of buying the dip, right? We see inflows to funds like I just mentioned, the more high-beta funds. We also have a lot of things that have exposure to crypto or AI. We're behind Chat with Roundhill or Block with, uh, Amplify. These are all funds that we service that we're seeing on dip days, people are leging in.
And how does that compare with the buying that you're seeing in some of those more safe areas of the market when it comes to things like gold, things like bonds?
Yeah, I've seen most of the gold or bond positions being paired with things. So like we have a client that has a Bitcoin and gold fund, BTGD. That's getting more of a bid than inflows into gold in general, even though gold is at an all-time high. Um, you know, we've seen, we have a GDX Y, which is gold miners with income by doing options. That's getting a bid in the space more than just going to short duration and things like that. Um, I, despite what feels like negative sentiment and uncertainty, the flows are just not stopped in ETFs.