Never miss an update

Asics Gel Nimbus Mens 18 Lite Asics Show T6E0N 9093 Mens Runing Runing Shoes Black Silver Sneakers a6e15ba




Never miss an update

Asics Gel Nimbus Mens 18 Lite Asics Show T6E0N 9093 Mens Runing Runing Shoes Black Silver Sneakers a6e15ba - blurrypron.com

    Asics Gel Nimbus Mens 18 Lite Asics Show T6E0N 9093 Mens Runing Runing Shoes Black Silver Sneakers a6e15ba
    Asics Gel Nimbus Mens 18 Lite Asics Show T6E0N 9093 Mens Runing Runing Shoes Black Silver Sneakers a6e15ba
    Nike Air Max Sequent 3 [921694-010] Men Running Shoes Black/Anthracite , Brooks Caldera Blue Lime Black Men Trail Running Shoes Sneakers 110242 1Dadidas PureBOOST Black Grey Men Running Shoes Sneakers BB6288Merrell Moab FST Mid GTX Gore-Tex Vibram Mens Womens Outdoors Hiking Shoe Pick 1Nike Jordan Fly Lockdown PFX [AO1550-100] Men Basketball Shoes White/Red-BlackNike Air Max 1 Fb Prem Running Men's Shoes SizeADIDAS ORIGINALS SUPERSTAR 80s REFLECTIVE AdiColor Trainers Shoes S80331 MINT , New Balance MS574PCW D White Red Men Running Casual Shoes Sneakers MS574PCWDSupra Jagati Mens Black Camouflage Leather & Mesh TrainersNew Balance ML99HHAG D Pink White Men Women Running Shoes Sneakers ML99HHAGD* NEW * Brooks Ghost 8 Mens Running Shoes (D) (059) + FREE AUS DELIVERY , Brooks Transcend 2 Mens Runner (D) (713) + Free Delivery Australia Wideadidas Originals Tubular Shadow Black White Men Running Shoe Sneaker BB6806 , NIKE MENS DOWNSHIFTER 8 BLACK 4E EXTRA WIDE SHOES 2018 **FREE POST AUSTRALIA , adidas Originals Deerupt Runner Blue Black White Men Running Shoe Sneaker B41764Nike Zoom Shift 2 EP [AR0459-001] Men Basketball Shoes Black/White , Gentleman/Lady Adidas Garter CQ2759 service Brand Fair price , NEW MENS PUMA KING TOP DI FIRM GROUND MEN'S INDOOR FUTSAL FOOTBALL BOOTS SHOESNike Air Max 90 Essential [AJ1285-008] Men Casual Shoes Platinum/Yellow OchreReebok R CrossFit Nano 2.0 Orange Infrared Mens Gym Cross Training Shoes J90890 , **SPECIAL** Brooks Ghost 10 Mens Running Shoes (D) (013)Gentleman/Lady Adidas Shorts BY9653 Customer first buy Reliable reputationReebok R CrossFit Nano 2.0 2 II Mens Cross Training Gym Shoes Sneakers Pick 1Mens Nike Air Huarache Run Ultra SE 875841 005 Solar Red Black Trainers , Adidas Samba OG Core Black, White & GumMan's/Woman's Adidas Quesence B37851 Year-end special promotions High quality and economy King of the crowdNike Air Max 90 Essential [AJ1285-101] NSW Running White/Yellow-BlueBrand New | Brooks Vapor 4 Mens Running Shoe (D) (013)Nike Air Max 90 Ultra 2.0 SE [876005-002] NSW Running Black/White
    Asics Gel Nimbus Mens 18 Lite Asics Show T6E0N 9093 Mens Runing Runing Shoes Black Silver Sneakers a6e15ba - blurrypron.com>Asics Gel Nimbus Mens 18 Lite Asics Show T6E0N 9093 Mens Runing Runing Shoes Black Silver Sneakers a6e15ba - blurrypron.com
    Luxury Rebel Women's Cara Boot,Black,7.5 M USGentlemen/Ladies Prada Fur Moccasin Ankle Boots for you to choose First quality Breathable shoes , LEATHER LOAFERS MADE IN ENGLAND SIZE 8.5CONVERSE CHAUSSURE AS HI LTH SUEDE - BLKWHT - 41 (888754877709)*BARGAIN* Asics Gel Lethal 18 Mens Football Boots (9045)Men's/Women's ADORE-708LG Clear Glitter Silver Moderate price low cost Reliable reputationGentleman/Lady Jefferey Campbell:Torres Silver Metallic superior Fast delivery Tide shoes list , Sperry Top-Sider Women's Barrelfish Casual Leather Boat Shoes Linen , Womens Retro Suede Pointy Toe Mid Heels Ladies Fashion OL Court Bowknot Shoes , Pleaser DELIGHT-609 Women's Black Silver Chrome Heel Platform Ankle Strap Sandal , Gentlemen/Ladies Bordello TEEZE-07SQ High quality and cheap Let our products go to the world Cheap orderVintage Casadei Italy blue Pony hair Sandals Slingbacks Heels Shoes 36 7 US , Nike Air Jordan 1 Retro '99 Black/Sport Blue-Infrared 23-White 654140-007 SZ 9NIKE NIKELAB ZOOM FLY CHICAGO TAUPE GREY/TAUPE GREY-OBSIDIA AA3172-200 SIZE 11NEW Nike Air Jordan XXXII 32 Retro "MVP" Mens Sizes Cement Grey Black AA1253 002 , British Fashion Men's Loafer Faxu Fur Lined Shoes Comfy Slip-resistant Outdoor , D.Caged Men's Brown Leather Sneakers 0715 Size 42 EU NEW , Donald J. Pliner men's size 8.5M Rad Black Baby Calf loafersMan/Woman Finn Comfort Men's Huelva High security Good market comfortable , $927 Classy ERMENEGILDO ZEGNA Black pointed-toe Dress Shoes (11)Allen Edmonds Madison Park Wingtip Oxford Walnut Brown Derby Shoes Size 7.5 D , Womens Nike Air Force 1 '07 Premium sz 9.5 616725 602 retro shoesAdidas Edge Lux Womens Running Shoe SKU BB8211 Size 11 , Nike Roshe Two Hi Black/White Women's 861707-001 , Under Armour Women's Slouchy Slip Sneaker - Choose SZ/Color , AUTHENTIC LUXURY PRADA SNEAKERS SHOES 3E5793 BLACK NEW US 9.5Ladies Brown Leather Stacked Heel Cowgirl Boots: Size 8.5R , 2017 Fashion Women Pull On Block Heels Ankle Boots Suede Pointy Toes Shoes Hot , Womens Fur Trim Pumps Ankle Boots High Heel Pointed Toe Leather Shoes Side zipAHNU SUGAR PEAK BLACK WATERPROOF HIKING TRAIL WOMEN`S BOOTS SIZE US 9.5 NEW ,
    Will ETFs cause the next market crash?
    ETF Watch - Jun 29, 2017
    Asics Gel Nimbus Mens 18 Lite Asics Show T6E0N 9093 Mens Runing Runing Shoes Black Silver Sneakers a6e15ba - blurrypron.com

    There’s no doubt that the last 2 years has seen the coming of age of ETFs. With what was once an unknown type of investment quickly becoming a $30b industry in Australia ($3 trillion globally). However, as ETFs have moved from the unknown to the flavour of the month, an increasing number of commentators have called on the risks ETF investors face, with some even stating that ETFs will be the source of the next market crash. Today we take a look at some of the claims as to why some believe there are so many risks associated with ETFs.

    Claim 1: ETFS are blindly pushing up stock prices

    Many have written about share markets being at record highs. In an interview with the AFR, Wilson Asset Management chief Geoff Wilson discussed his portfolios’ current high weightings to cash due to concerns of market over-valuations. 

    US based fund manager FPA capital called ETFs “Weapons of Mass Destruction”and stated “The flood of money into passive products is making stock prices move in lockstep and creating markets increasingly divorced from underlying fundamentals”. The argument they make is as ETFs blindly invest in stocks in their chosen index and ignore the underlying fundamentals of these companies. This causes these companies prices to be bid up to prices that do not support their fundamentals (ie a bubble), and eventually history repeats, the bubble bursts and markets crash.

    What do we think?

    ETFs account for around 10% of US stocks’ market value and less than 1% in Australia. In the US at least this is not an immaterial amount. However, the active managers whom ETFs have taken business from generally have mandates which force them to invest a certain percentage in the market. As a result, active managers have always been investing in expensive markets and pushing up prices. Additionally, what is currently called by many analysis as expensive equity markets could also be attributed to global record low interest rates rather than an uptick in passive investing. In saying that, since the last major market crash (the 2008 GFC), the proportion of total assets in ETFs are considerably higher and continual growth of passive investing must be considered as a possible cause of markets becoming expensive.

    Recently we’ve seen Vaneck reweight their huge Junior Gold Miner’s ETF as they approached 20% limits in some of their smaller holdings. This meant selling out of these small gold miners which saw large falls in some of these shares (some of which was blamed on hedge funds looking to capitalise on the opportunity). This is a great example of the influence that ETFs can have, albeit this is at the small end of the market.

    Claim 2: ETFs will sell on mass and compound market falls

    One of the known weaknesses of a managed fund structure is the ability for investors to fairly easily redeem their funds, meaning at times of market falls, when a fund manager may find the best investment opportunities, the investors in the fund are panicking and redeeming their investments, meaning the fund manager becomes a forced seller rather than a buyer. This was one of the reasons Forager decided to turn their Australian Share Fund (FOR) into a Listed Investment Trust, where the pool of capital for them to invest was guaranteed.

    The one thing stopping simple redemption of managed funds during market crashes is another one of its weaknesses, which is managed funds are not simple to trade, and require the investor to apply to the fund to redeem units. This can involve filling out paper forms, and an apathetic investor may simply not be bothered.

    What do we think?

    One of the greatest advantages of ETFs is also one of its weaknesses when it comes to the above, with ETFs able to be traded on the ASX, a panicked investor simply has to log into their online brokerage account and hit the sell button. If a buyer does not exist on the other side of the trade, the ETF issuer is forced to then sell the underlying holdings which could very well begin a contagion effect.

    However, we come back to the size of the ETF market, at around 1% of the Australian market and 10% of the US market. Investors selling underlying stocks that they own through their broker will have the exact same impact as the reasonably small proportion of ETFs. We believe the actual impact of this event would be not materially higher than what currently exists.

    Claim 3: ETFS with low liquidity will be hard to sell if markets fall

    Peter Switzer recently spoke about a client who had received advice that an ETF with low liquidity would be difficult to sell if markets fall. The argument being that without a liquid market the seller would be unable to find a buyer on the other side of the trade and would need to sell at a significant discount.

    What do we think?

    One of the somewhat unknown components of ETFs is the role of the market maker. Essentially the market maker’s role is to provide liquidity to an ETF, so that if there is not an existing ETF unit on the other side of an ETF trade, the market maker must create an ETF unit for a buyer, or absorb an ETF unit for a seller. It is then the ETF issuer's role to buy or sell the underlying assets that the ETF holds. This means that regardless of an ETF’s liquidity, a market maker will always exist to buy an ETF off an investor even if the markets in free fall.

    However, there is a caveat to the above. Market makers make a profit by charging a spread between the buy price and the sell price of an ETF. The spread becomes the market maker’s profit margin. In a free falling market it may be difficult for the market maker to price the underlying investments forcing them to create a huge spread between the buy and sell price to protect their margins. This was seen in the 2015 Dow Jones ‘Flash Crash’, where some ETFs dropped 30% when the market makers were unable to price the underlying securities.

    Asics Gel Nimbus Mens 18 Lite Asics Show T6E0N 9093 Mens Runing Runing Shoes Black Silver Sneakers a6e15ba - blurrypron.com

    Finally, an ETF is only ever as liquid as its underlying holdings. ETFs which invest in illiquid investments may have great liquidity, but if the underlying investments do not, this will likely be reflected in falls in both the underlying holdings and the ETF during market falls. This may be more likely to play out at the small cap end of the sharemarket and within unlisted asset classes.

    Claim 4: ‘Exotic’ ETFs are higher risk

    In a recent RBA publication, economist Michelle Cunningham discussed the risks faced with some of the more exotic ETFs, those that are classed as ‘synthetic’ ETFs, meaning the ETF issuer does not hold the underlying investments, rather they rely on a counterparty to pay the return. These ETFs are generally referred to as ‘Synthetic’ or ‘Hedge fund’ in their title. Cunningham raised the risk that the counterparty may default on their obligation, so an additional level of risk exists for the investor.

    What do we think?

    We agree with Cunningham’s analysis, an additional level of risk certainly exists with these ETF structures, however in many cases this is the only way to access to investment strategy that the ETF provides. Nevertheless, investors should be aware of the additional risks that exist.

    Conclusion

    There’s plenty of arguments in both camps about ETFs role in future market crashes. There’s no doubt the world has moved into uncharted territory with the rise of passive investing & ETFs in particular. We do believe, however, that some of the risks are overblow. Nevertheless, investors should be aware of these risks in order to make informed investing decisions. What do you think?

     

    Previous Article

    2017 Financial Year ETF and LIC Performance Table

    Next Article

    New Fixed Interest ETFs expand options for investors

    Leave a Reply
    Find a Fund
    Asics Gel Nimbus Mens 18 Lite Asics Show T6E0N 9093 Mens Runing Runing Shoes Black Silver Sneakers a6e15ba
    Athletic Shoes
    >
    ;