Lara Krieger reveals the main stories of 2022 | Jobs Vox


Specially ETF Prime, Krieger and Ben Johnson sit down with host Nate Geraci to recap the best stories of 2022 in ETFs and look ahead to 2023.

Setting the table, Gerasi noted at the top of the show, “It’s been another monster year for ETFs. Second best revenue year, record transaction volume, number of new entrants – including big names like Capital Group, Doubleline and Matthews Asia. We’ve seen continued innovation in products that have literally never been done before – single stock ETFs, single bond ETFs, NightShares. There’s a reason why ETFs are called Silicon Valley asset management.

Year of equal income

After expressing their gratitude to the audience and reflecting on it for twelve years ETF The Prime Podcast brought in Gerasi Krieger and asked her what the top topic for 2022 is. ETF It will be the world. Krieger brought up an under-the-radar theme and said, “I think 2022 is the year of equity income.” Not surprising to Crigger as Dividend ETFs. JPMorgan Equity Premium Income ETF (JEPI A) They were consistently among the most researched funds on the site. JEPI In the year They capture $12 billion in inflows by 2022, along with other dividend ETFs like these. Schwab US Dividend FundSCHD A) Also racking up impressive numbers. “Poll after poll has been saying that dividends and equity income are extremely important to advisors, and they see it as a way to deal with a balanced environment and inflation,” Krieger said.

Asked if she was surprised by the $600 billion in outflows ETFs took in a year when both stocks and bonds were crashing, Krieger said she wasn’t too surprised. “Investors really like to buy on dips.” According to Krieger, down markets offer attractive prices, which create excellent buying opportunities for investors. There is also a phenomenon in the markets, as this year’s progress and technology have done, one area can crash, and another will rise. Krieger pointed to a correction in commodities received as inflation news began to unfold, prompting investors to hedge into commodities. “There’s always some instrument or some investment that can help you weather the current market conditions,” Crigger said, referring to the depth and breadth of ETFs currently available.

Geraci agrees, seeing this year as the year FFAs officially withdrew from mutual funds, which saw significant inflows. “I think people will look back at 2022 as the new tipping point ETF Era,” he said.

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Good grief

There was another big story this year ESG“That was the point where I realized there was a lot of greenwashing,” says Krieger, who became more cynical after being a cheerleader. ESG ETFs have stagnated on income streams, which Krieger accepted could only be related to the low market. Speaking with his own acronym, Krieger asked, “Has it gone the smart beta route?” He thought, and realizing how much water he was drinking became a word that really meant nothing. ESG It has become a place. Other terms are beginning to struggle to replace it. ESG“Paris aligned” and “climate change” among them, but it remains to be seen if any of these will catch on and become a new umbrella term.

Krieger thinks vague, vague weight loss tools are harder to disprove than more concrete examples. Telling someone that he has funds ESG When EVs are the new cars, the screener is more abstract than presenting the lithium fund case.

Energy has had a big year as noted by Jerasi and ESG Overweight technology and the energy of growth and weight loss creates a performance problem for many ESG Funds. “Performance is king in financial markets,” Gerasi said before adding ESG This year has become very political.

“On the defense ESG, we’re seeing a lot of interest in terms of participation on the platform, with renewable energy funds again being easy to understand,” Krieger said. She pushed back the idea of ​​politics ESGNoting that renewable energy is one of the few areas where both sides agree. “Regardless of my political beliefs, I am interested in power transition. For this I have to put my portfolio.

Goods are hip again

Another big story from 2022 is the rise of commodities. “It’s just been a battle,” Krieger muses, “and now I’m hearing people say that commodities should be a strategic part of your portfolio for good — not just for now or the next couple of years, but for good. He said.

Flows into commodity ETFs spiked before leveling off at the end of the year, but Krieger thinks investors have taken notice of the position and alternatives in general. Krieger pointed to the future as a monster year with such funds iMGP DBi managed future strategy ETF (DBMF B+) Amassing impressive performance numbers.

Gold has had an unusual year, with the yellow metal down just 3% for the year, sidelining the carnage in the rest of the markets, but gold ETFs have seen massive inflows. “It’s no surprise to me that we’re seeing outflows from the gold space, even though inflation is modest,” Krieger said, adding that flows for the rest of the commodity space are still strong. of Invesco High Yield Diversified Commodity Strategy No. K-1 ETF (PDBC ) It’s still garnering a lot of attention, according to Krieger.

The commodities space is ripe for innovation, with 2022 the first year investors can get K-1 free exposure to grains like ETFs. Teucrium Agricultural Strategy No. K-1 ETF (as long as ). Krieger believes more innovation is in store for 2023.

Famous start

Asked about notable startups of the year, Krieger mentioned recent digs at the topic as well as single security ETFs. Although the bull and bear version of stocks seems like a clear statement of a single security. ETFBonds seems to have an imagination, with both US Treasury 3 month account ETF (Tbl ) and the US Treasury 2 year note ETF (UTWO ) Trembling in heavy flows. “These EFAs solve a problem,” Krieger said.

2023 predictions

Krieger’s first bold prediction was, “This is the year we officially ditch the 60/40 idea.” She thinks investors will continue to look to equities. “People are used to getting income from the equity markets, which doesn’t change even if yields rise,” Krieger said, pointing to the success of dividends.

While she sees fixed income taking a smaller piece of the pie, alts will be a core part of the modern portfolio. Geraci pushed back, saying the income was returning to fixed income, but Krieger said, “Why go 4% or 5% when you can get 14%? JEPI?

Her other big prediction was focused on crypto. “2023 is the year we’ll see crypto get back into the groove,” Krieger said, noting how new technology is frequently created and changed. In particular, Blockchain has many uses that have not yet been exploited. You will not see bitcoins anywhere. ETF Despite Greyscale’s accusation that it’s coming anytime soon. When asked if the lawsuit could change anything, Krieger said, “If anyone gets shot, it’s grayscale,” but she thinks it’s hard to argue that there was no fraud or manipulation involved in the exchange. FTX A story looming over the headlines. She thinks that crypto needs to overcome the reputational risk caused by the crash. FTX.

For a final prediction, Krieger He joked that there would be a life-changing event in early 2023, pointing to the 2020s. covid Lockdowns, 2021 Rebellion Trial and 2022 War. “I locked my door, I’m locking it, and I’m hiding in my house,” she said.

Johnson’s 2022 year history and 2023 predictions

Listening to Krieger’s top stories, Johnson added, “If you look at Morningstar’s 128 categories, only 9 see positive returns,” reflecting the high inflows into mutual funds and the big swings into ETFs. Johnson notes that “ETFs are cheaper, more convenient, and generally more consistent with modern advisory models.”

He also sees that ESG Declining demand as a big story, partly due to politics. Johnson thinks many asset managers are quietly merging ESG To their work flow, so he sees it ESG Despite the challenges, he is alive and well. Regulators see an opportunity to clarify here, but “I think appetite will remain muted,” he said.

Jerasi has brought active management, Johnson thinks he will continue to step in. In the year Most of the launches were active by 2022, he said. Vibrant is here and very much here to stay.

For 2023, John predicted a 60/40 return. “I don’t think 60/40 is going to go away,” he said, having previously written about the issue. He thinks that direct indexing may not benefit average investors in the same way it does high net worth investors, but he understands how it will change the landscape of software and investing. “Software shows itself everywhere.”

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