The September swoon is in full swing

FRI, SEP 16, 2022

YOUR WEEKLY UPDATE ON TOP ETF TRENDS

A NOTE FROM BOB

After a turbulent week for the stock market, there is no question the September swoon is in full swing. What's an ETF investor to do about all the near-term noise from a global slowdown, stubborn inflation and still-hawkish Federal Reserve? Join us on Monday on ETF Edge, when we'll speak to Nick Colas, Co-Founder of DataTrek Research, here to help us parse the market mayhem and offer insights into the latest ETF trends. We'll also be joined by Charles Ellis, author of the legendary investing book Winning the Losers Game. He has two new books coming out – one called Figuring It Out, a collection of his best investing essays – and another called Inside Vanguard. Ellis is one of the great thinktanks who helped create the indexing business in the 1970s, so he'll share his wisdom on active versus passive and where we are today.

Active still underperforming in 2022. S&P Dow Jones Indices just published its Mid-Year 2022 SPIVA U.S. Scorecard this week, and the report arrived at its usual conclusion: "The majority of actively managed funds are unable to outperform their benchmarks over the long-term" – a prevailing SPIVA theme. While actively managed large-cap U.S. equity funds were on track for their best (i.e. lowest) underperformance rate since 2009, still less than half were able to outperform their benchmark in the first six months of 2022.

New ways to gain exposure to global dividends. China may be plagued by recurring Covid lockdowns, but the world's second largest economy has seen a few bright spots recently – including a critical easing up of tech scrutiny. From 2000 until 2010, Asian regional equity markets outperformed developed markets by a hefty 90% – but from 2011 to 2021, the region underperformed the MSCI World Index by 45%, unwinding all of its previous outperformance. This week, KraneShares just announced the launch of its new S&P Pan Asia Dividend Aristocrats ETF (KDIV) on the New York Stock Exchange – offering an entry point for investors looking to capitalize as the region plays catchup. KDIV tracks the S&P Pan Asia Dividend Aristocrats Index, which provides exposure to companies in China, Japan, Australia, and other Asian countries that have paid and increased their dividends consistently over a sustained period. This time around, the ETF is offering access to the S&P Dividend Aristocrats methodology applied to the Pan Asia region, one of the fastest-growing areas in the world.

For more analysis and actionable insights, catch me live this Monday at 1 PM ET on ETF Edge.