Daniel Straus, M.Fin, Ph.D., Director and Head of ETF Research and Strategy, at National Bank Financial joins us for a full bodied conversation about the North American ETF ecosystem and macro landscape.
Highlights
- Daniel’s background in engineering, technology & finance
- How the ETF landscape has changed in 12 years
- Observation that ETFs have become a game changer, the dominant solution – but already people are talking about what the ‘next thing’ will be. Direct indexing, DeFi, etc.
- Canadian ETFs are $350-billion, about 1/20th of the $7-trillion U.S. ETF market. Canadian adoption is accelerating as we catch up with the U.S. adoption, but Canadian tax efficiency is not as favourable as in U.S. and that may be part of the reason adoption trailed.
- How ETFs are being used by advisors, how factors are sometimes substituted for sector bets in diversification, how ETFs have democratized access to liquid alts
- Mutual fund companies are entered the ETF business and strongly behind actively managed ETFs (e.g. Dynamic, Desjardins, Manulife, Mackenzie). Insurance companies have entered the ETF business.
- How many ETFs are there in Canada now
- Thematic ETFs
- Liquid Alts ETFs – what were once complex strategies reserved for institutions and UHNW, are being wrapped in ETFs for all investors to access
- It helps to have a 1-year or 3-year sample of actual performance in order to see an uptick in adoption. Some of the more sophisticated users of ETFs like to see actual numbers vs. back tests before they’ll commit to some of the more complex strategies.
- How did the ETF landscape change over the last 2 years?
- How did ETF flows change since last year’s inflationary uptick and into January 2022?
- What did investors do? How did they behave in January’s rout? Where did the ETF dollars shift to?
- Daniel shares his knowledge of market structure at length – How can thoughtful PMs best approach ETF trading to get the best outcomes for their investors/holders.
- How advisors/PMs’ can optimize their outcomes on large trades?
- What are Carbon Nanotubes?
- Daniel shares some of his Sci-Fi favourites
Where to find Daniel Straus, National Bank Financial:
Where to find the Raise Your Average crew:
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“You don’t have to be brilliant, just wiser than the other guys, on average, for a long time.” Charlie Munger
Welcome to Raise Your Average, our deep dive journey into learning from the people and process behind the world of investing. Through conversations with leaders in the investments game, we peel back the layers of the onion on how these holders of the keys to the kingdom allocate their time, their energy, and their dollars.
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Music credit: In Hip Hop, Paul Velchev (8MJZA6T3LK)