Industry Updates

Morningstar finds that strategic beta underperforms - News Roundup

David Tuckwell

Strategic beta is not so strategic

Strategic beta ETFs have received plenty of hype and lots of attention. But have they delivered? Not really. A new survey by Morningstar has found they mostly underperform their market weighted peers.

Leaps bring long term call options to ETFs

Long-Term Equity Anticipation Securities, or Leaps, are a new innovation that work just like a long-term call option. They allow investors to buy a set number of ETFs at a set price at a set date up to three years in the future. What are they used for? Well, in times of high volatility they're useful for hedging. But as volatility is low at the moment, not a lot.

Things fall apart

The US ETF industry is changing in many ways. For the first time ever this month, two issuers were bought out by Chinese firms. Algorithms and robots are coming in more, as in BlackRock's equity division. Vanguard is also becoming the likely industry king as many see its not-for-profit model as a beacon.

Featured in this article


No ETFs to show.