Never miss an update

SPERRY TOP SIDER GREY WOMEN'S ANGELFISH FLAMINGO BOAT 29936 SHOES GREY 7M MULTI SIZE 7M NEW! 6bb3d09




Never miss an update

SPERRY TOP SIDER GREY WOMEN'S ANGELFISH FLAMINGO BOAT 29936 SHOES GREY 7M MULTI SIZE 7M NEW! 6bb3d09 - blurrypron.com

    SPERRY TOP SIDER GREY WOMEN'S ANGELFISH FLAMINGO BOAT 29936 SHOES GREY 7M MULTI SIZE 7M NEW! 6bb3d09
    SPERRY TOP SIDER GREY WOMEN'S ANGELFISH FLAMINGO BOAT 29936 SHOES GREY 7M MULTI SIZE 7M NEW! 6bb3d09
    SAS Maria in Dark Brown - Made in the USA , Sperry Top-Sider Suede A/O 2-Eye Boat Deck Shoe Gray (STS94328) Women Sz: 5.5M , Womens Loafer Real Leather Casual Fashion Party Oxford Style Flat Heel ShoesRALPH LAUREN - WOMENS 'GAIA' BLACK PATENT DRIVING LOAFERS WEDGES - 7.5B , Women's Merrell Grassbow Sport J21526 Flame/Rouge 6.5Women Shoes "Sneakers" BUTTERFLY . Slip-on . Printed Canvas . USA 5 . SUPERB , Cole Haan Womens Minniesam Closed Toe, Faded Teal, Size 6.0Gatsby Red Dots Jon Josef Satin Loafer FlatLOT 5 Strappy Rhinestone Detailed Thong Sandals Faux Suede PVC Flat Thong shoes , Man/Woman Women's Aetrex Mochaberry Zip-On Shoes Aesthetic appearance Selected materials List of explosions , Halogen Nella Ghillie Black Kidsuede Womens Flat Sz 9.5M 7003 , VANELi Women's Rona Black Patent Leather Slip-on Loafer Flat , Mr/Ms Walking Cradles Womens bounce Closed Toe Adequate supply and timely delivery delicate Very good color , Renouard Plancoet Women's Bone White Tan Wooden Button Loafers Size 41 - US 10.5 , JOAN & DAVID BROWN Croc Leather Shoes 37 , NEW Clarks Artisan Nubuck Perforated Slip-ons Sand Daelyn Summit Shoes Sz 10MFranco Sarto Womens Loafer Blanchette Slip On Shoe Tan Khaki Size 8M MSRP 99 New , NEW RANGONI Firenze of Italy dress shoes brown 7 AA career loafers work , Gentleman/Lady Here Black Gray Nine West Flat High security High-quality materials SimpleYOSI SAMRA Beige Snakeskin Embossed Leather Ballet Flat Foldable Women’s Size 6Man/Woman Nine West Women's Florent Pump Complete specification range Comfortable touch Diversified new design , Cole Haan Womens CHW14023L-3 Closed Toe Oxfords, Roccia, Size 6.0SKECHERS RELAX FIT SHOES - MEMORY FOAM - SZ 7 - NWOB - B-SHO-3Gatsby Black/White Dots Jon Josef Satin Loafer Flats , NWOB EMPORIO ARMANI SEQUINS BLUE BUCKLE STRAP PUMP HEEL SIZE 5 (SH3000NWT Anne Klein Jacquard-Print Slim-Leg Pants , Size 4Authentic Manolo Blahnik made in Italy flats - check it out!Taos Shoes Bravo - leather Comfort shoes , Gentleman/Lady Flat Nine West Owl Navy Suede Economical and practical Comfortable touch Exquisite processing ,
    SPERRY TOP SIDER GREY WOMEN'S ANGELFISH FLAMINGO BOAT 29936 SHOES GREY 7M MULTI SIZE 7M NEW! 6bb3d09 - blurrypron.com>SPERRY TOP SIDER GREY WOMEN'S ANGELFISH FLAMINGO BOAT 29936 SHOES GREY 7M MULTI SIZE 7M NEW! 6bb3d09 - blurrypron.com
    Asics GEL-Resolution 7 [E751Y-400] Women Tennis Shoes Blue Print/PinkVAN DAL BETHANY LADIES MOCCASIN SMART FLAT SLIP ON CASUAL LEATHER LOAFERS SHOES , PLEASER FLAMINGO-808 CLEAR PLATFORM SANDALS STRIPPER POLE DANCE , Men/Women Nike kaishi NS 747492-666 US9.5 Louis, elaborate Make full use of materials Elegant and stable packagingAS NEW Irregular Choice Toasted Teacake Black Women's Ankle Boots size Aus 9/40NEW! $450 Stubbs and Wootton Needlepoint & Leather "CREST" Slippers Loafers Shoehot NIB STEVE MADDEN 'Carli' purple fuchsia patent heels shoes 7 - CLASSY , Rebecca Minkoff Women's Acadia Ankle-High Suede PumpAdorable Pink Ice Cream 6" Stiletto Platform Fashion Party Shoes - Size 10 , Christian Louboutin Black Leather Platform Pump Size 37.5 , Men's/Women's Calvin Klein Cadina Suede Sandal, Red Economical and practical high quality renewed on time , NEW NIKE AIR JORDAN FLIGHT FLEX TRAINER sz 11.5 BLUE RED WHITE shoes sneakersADIDAS INCISION TRAIL Running MENS BA8657 NEW , NEW Men’s Nike Sz 11 Aptare Essential Tan/White 876386-200Nike LTD 3 For Men Size 10 In Full Black Brand New 687977-020Old School Retro Mens Red Reebok Classic Ex-O-Fit Gum Hi Tops Size 8 USMan's/Woman's 06 Nike Dunk High 312786 222 Elegant shape Online Immediate delivery , Nike Men's Air Zoom Pegasus 34 Sneakers Pure Platinum Gray 10.5 or 12 880555-010 , Saucony Originals Men's Grid SD Sneakers - Choose SZ/ColorGentlemen/Ladies New Balance ML999 - ML999COP Crazy price Cheaper than the price Global sales , Nike SB Paul Rodriguez 9 Elite QS J-Rod Jordan Jumpman P-Rod SZ 9 , English Laundry Men's Landseer Fashion Sneaker, Black, 11 M USMen Floral Pointy Toe Business Dress Formal Shoes British Casual Pumps Fashion**NewStylish Mens Casual Fashion Shoes Footwear Contrast Bulge Accent Sneakers , Nike Flex RN 2017 Women's Running Shoes Size 9 White Silver 898476-100 , Under Armour Women's Speedform Gemini 3 Running Shoe - Choose SZ/ColorInov-8 Womens F-Lite 250 Shoes 5054167446 Teal/Navy/Purple Size 11 , NEW NIKE FLYKNIT ZOOM AGILITY WOMEN'S RUNNING TRAINING SHOES PINK PURPLE 698616NIKE AIR MAX 1 LE GS GAMMA BLUE ORANGE US 4.5Y PINK 90 HUARACHE HYPERFranco Sarto Delancy Wrap Strap Ankle Boots, Mushroom ,
    Will ETFs cause the next market crash?
    ETF Watch - Jun 29, 2017
    SPERRY TOP SIDER GREY WOMEN'S ANGELFISH FLAMINGO BOAT 29936 SHOES GREY 7M MULTI SIZE 7M NEW! 6bb3d09 - 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.

    SPERRY TOP SIDER GREY WOMEN'S ANGELFISH FLAMINGO BOAT 29936 SHOES GREY 7M MULTI SIZE 7M NEW! 6bb3d09 - 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
    SPERRY TOP SIDER GREY WOMEN'S ANGELFISH FLAMINGO BOAT 29936 SHOES GREY 7M MULTI SIZE 7M NEW! 6bb3d09
    Flats
    >
    ;