Weekly Market Monitor – Week Ending 18 November 2022

  • Chinese focussed ETFs were amongst the top performers last week as investors rode a wave of optimism on the possibility of a softening Covid policy (ASIA, ASAO, IZZ, PAXX). While the Chinese government has yet to make any official statements, a re-opening of Chinese cities would bolster its economy.
  • The poorest performing ETFs were energy-transition themed ETFs (GMTL, URNM, XMET) as COP27 concluded with no clear resolution surrounding the phasing out of fossil fuels. Oil and gas ETFs (OOO) also fell however, for fear of further U.S rate hikes and low Chinese demand.
  • There were $368 million in reported inflows with AUD hedged funds making up a significant portion, likely due to investors reducing their USD currency exposure off the back of a strong YTD performance and a softer inflation print. Global X Ultra Short Nasdaq 100 Hedge Fund (SNAS) also received significant inflows, indicating an investor rotation from long to short Nasdaq exposure.
  • There were $190 million in reported outflows, making it another week of net inflows for the industry.
  • Trading volumes were dominated by large index funds as usual (VAS, IOZ, IVV). Hedge funds providing short US exposure also had a strong showing (SNAS, BBUS) as investors traded on tech volatility.

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