What happened last month?

1 Informed Investor: Money Monitor November By Marlène Hassine Konqui, Head of ETF Research and Kristo Durbaku, ETF Research Analyst Strong rebound for European ETFs Net new assets in the European ETF market rebounded to 4bn in November well up from the 753m we saw in October. gathered the bulk of the inflows ( 2.8bn), after another strong month for US equities ( 1.4bn) and further signs of renewed interest in ESG ETFs ( 491m) and China equities ( 334m). Fixed income ETF inflows doubled, led by developed market government bonds after they enjoyed their best month ever ( 1.9bn). Commodities, meanwhile, continued their descent. What happened last month? ETF flows climbed to 4bn from 753m YTD flows now stand at 42.5bn 4bn Equity inflows rebound 2.8bn Fixed income flows double 1.5bn Commodities still suffering - 31m Smart Beta interest rekindled 1.8bn Source: Monthly data in EURM from 1/11/ to 3/11/ Bloomberg, Lyxor. Note: This report is based on the data available on 1/12/. Asset and flow data may be slightly adjusted as additional data becomes available. counterparties or professional clients within the meaning of markets in financial instruments directive 24/39/ce.

2 What were the major trends? Equity inflows rebound 2.8bn Monthly net inflows on European Equity ETFs 1,451 Developed 1,414 of wh. US Japan equity flows return to the red Europe equity inflows stop abruptly 1,35 of wh. World Global equities rebound 1,96 Global US equities attracted most of the inflows -483 of wh. Asia Pacific -1,219 of wh. Europe 271 Emerging Fixed income flows double 1.5bn Monthly net inflows on European Fixed Income ETFs 1,891 Developed 987 of wh. Europe US treasury flows remain strong 68 of wh. US High yield bond flows turn negative 229 Emerging 158 Coprporate Bonds -342 High Yield Inflation-linked bonds suffer more outflows -211 Inflation Linked -317 Money Euro government bond flows double Source: Monthly data in EURM from 1/11/ to 3/11/, Bloomberg, Lyxor. counterparties or professional clients within the meaning of markets in financial instruments directive 24/39/ce.

3 Special focus China comes right into focus China equity ETF recorded their 3rd best month ever with 334m of inflows in November. This may be the latest sign of a more durable trend, which began in June as shown in Graph 2 below and is unmatched when looking at monthly flows on Chinese equities for the last three years. So, what s behind it? In our view, the equity investing environment is much more favourable than it was. First, Chinese equities may have bottomed out - given easier financial conditions in the US (see negative correlation Strong inflows 334m with Chinese equity prices in graph 1), a potential easing of trade tensions and the likelihood of more accommodative measures from the central bank and the Chinese government. Second, growth remains twice as fast as the US even if it is slowing right now and that slowdown may only be down to more specific, possibly temporary factors anyway. Third, valuations are cheap and this could sustain a recovery after the recent sell-off (MSCI China fell 11.5% in October). US financial conditions Index vs. MSCI China Index 99,5 US financials conditions MSCI China 14 99,4 12 99,3 1 99,2 99,1 8 99 6 98,9 98,8 215 215 216 216 216 216 216 216 216 216 216 216 Easier US financial conditions coupled with Chinese equities rebound... 216 216 217 217 217 217 217 217 217 217 217 217 217 217 4 2 China equity ETFs monthly flows 4 3 China Equity ETFs flows...could support a durable positive trend on flows. 2 1-1 -2-3 -4 215 215 216 216 216 216 216 216 216 216 216 216 216 216 217 217 217 217 217 217 217 217 217 217 217 217 Source: Monthly data from 3/11/215 to 3/11/, Bloomberg, Lyxor Cross Asset Research, Lyxor ETF. counterparties or professional clients within the meaning of markets in financial instruments directive 24/39/ce.

4 What does it all mean? A moderately successful year so far - 5bn above 216 ETFs on the rise 45.5bn Total AUM is up 4.5% since 217 666bn YTD net Inflows on European ETFs by asset class Still a decent year for Equity ETFs Total 31,553 Developed 25,757 Fixed income ETFs lagging far behind of wh. US 2,453 of wh. World 7,216 Emerging 3,184 Global 2,611 Total Fixed Income 1,81 Developed 8,719 of wh. Europe 3,287 of wh.us 4,519 Emerging 1,678 589 Inflation Linked Bad year for Commodity ETFs 47 Money -62 Commodities -1,3 of wh. Asia Pacific -1,959 of wh. Europe Discover more -1,337 Corporate bonds -69 High Yield Find out whether the money is going to the right place with our Manager Monitor Read more Check out our key investment calls with the Latest from Lyxor Read more Check out the most relevant big investment idea Read more Explore our online analytics tools www.lyxoretf.co.uk/en/instit/etfresearch/type/monthly-flows Source: Monthly data in EURM from 1/1/ to 3/11/, Bloomberg, Lyxor. counterparties or professional clients within the meaning of markets in financial instruments directive 24/39/ce.

Appendix: The month in numbers European ETFs in November Net Inflows (EURm) NNA rebound to 4.bn from 753m in October Monthly NNA on European ETFs Total Still a decent year for European ETFs Cumulated monthly NNA on European ETFs 5 Fev- 217 753 794 1,14 672 1,331 2,293 3,979 1, 215 216 217 4,258 4,212 5,849 7,871 13,575 2, 4, 6, 8, 1, 12, 14, 16, 9, 8, 7, 6, 5, 4, 3, 2, 1, Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Equity Still a good year for equity ETFs ( 31.6bn YTD) Cumulated monthly NNA on equity ETFs Equity Emerging Emerging market equity flows have slowed Cumulated monthly NNA on emerging market equity ETFs 7, 215 216 217 6, 5, 4, 3, 2, 1, 1, 8, 6, 4, 2, -2, 215 216 217-1, Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec -4, Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Fixed income Fixed income inflows head past the 1bn mark Cumulated monthly NNA on fixed income ETFs Commodities Worst ever year for commodity ETFs Cumulated monthly NNA on commodity ETFs 3, 215 216 217 3,5 215 216 217 25, 3, 2,5 2, 2, 15, 1,5 1, 1, 5 5, Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec -5 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Source: Monthly data in EURM from 1/1/215 to 3/11/, Bloomberg, Lyxor. counterparties or professional clients within the meaning of markets in financial instruments directive 24/39/ce.

6 Overview by asset class Equity Equity inflows rebounded strongly Monthly NNA on equity ETFs 14, 12, 1, 8, 6, 4, 2, Developed market equities still outdo EM peers Monthly NNA on developed vs. emerging markets equity ETFs 1, Developed Emerging 8, 6, 4, 2, -2, -2, 217-4, 217 Fixed Income Significant inflows for Fixed Income ETFs ( 1.5bn) Monthly NNA on fixed income ETFs DM bonds outdo EM peers again Monthly NNA on developed vs. emerging markets fixed income ETFs 3, 2,5 2, 1,5 1, 5-5 2,5 Developed Emerging 2, 1,5 1, 5-5 -1, 217-1, 217 Commodities Flows into Commodity ETFs collapse again Monthly NNA on commodity ETFs...mainly due to broad commodity ETFs Monthly NNA on broad & precious metals ETFs 8 6 4 2-2 -4-6 -8-1, 217 1, Broad Commodities Precious Metals 8 6 4 2-2 -4-6 -8-1, 217 Source: Monthly data in EURM from 1/12/217 to 3/11/, Bloomberg, Lyxor. counterparties or professional clients within the meaning of markets in financial instruments directive 24/39/ce.

7 European Flows on European Equity ETFs plummeted Monthly NNA on European equity ETFs Virtual flat month for German equity ETFs Monthly NNA on German equity ETFs 5, 4, 1,5 3, 1, 2, 1, 5-1, -2, -5-3, -4, -1, -5, 217-1,5 217 First positive month for Italian and Spanish equities since 17 Monthly NNA on peripheral Europe equity ETFs Little interest on developed Europe equities Monthly NNA on developed Europe region equity ETFs 5 3, -5 2, -1 1, -15-2 -25-3 -1, -35-4 -2, -45 217-3, 217 Eurozone equity flows turn negative Monthly NNA on Eurozone equity ETFs 4, 3, 2, 1, -1, -2, -3, First positive flows into financials Europe equity ETFs since February Monthly NNA on financials Europe equity ETFs 1, 8 6 4 2-2 -4-4, 217-6 217 Source: Monthly data in EURM from 1/12/217 to 3/11/, Bloomberg, Lyxor. counterparties or professional clients within the meaning of markets in financial instruments directive 24/39/ce.

8 (cont d) US & Japan equities Positive trend weakens slightly for US Equity ETFs Monthly NNA on US equity ETFs 3, 2,5 2, 1,5 1, 5 Japan equity rebound wasn t reinforced Monthly NNA on Japan equity ETFs 1,5 1, 5-5 -1, -1,5 217-2, 217 Emerging market equities Small inflows continue on emerging market equity ETFs Monthly NNA on emerging market equity ETFs 2, 1,5 1, 5-5 -1, -1,5 Still little interest on broad EM equity ETFs Monthly NNA on broad EM equity ETFs 1,5 1, 5-5 -1, -2, 217-1,5 217 Smart Beta / Value Best month ever for smart beta ETFs Monthly NNA on smart beta ETFs 2, 1,5 1, 5-5 Second consecutive positive month for value style equity ETF flows Monthly NNA on value style equity ETFs 4 2-2 -4-6 -8-1, 217-1, 217 Source: Monthly data in EURM from 1/12/217 to 3/11/, Bloomberg, Lyxor. counterparties or professional clients within the meaning of markets in financial instruments directive 24/39/ce.

9 Fixed Income European Inflows into EU government bonds accelerate Monthly NNA on EU government bond ETFs 1,5 1, 5 US Still solid inflows into US treasuries Monthly NNA on US government bond ETFs 1, 8 6 4 2-5 -2-1, 217-4 217 Inflation Linked Inflation-linked bond flows remain negative Monthly NNA on inflation-linked bonds ETFs 8 6 4 2 EM debt Modest inflows into emerging market debt Monthly NNA on Emerging market debt ETFs 1,2 1, 8 6 4 2-2 -2-4 -4 217-6 217 Credit Corporate bonds favoured over HY peers Monthly NNA on corporate & high yield bond ETFs Short-bond strategy Strong rebound for short bond strategies Monthly NNA on short bond strategy ETFs 1, Corporate Bonds High Yields 3 2 5 1-1 -5-2 -1, -3-4 -1,5 217-5 217 Source: Monthly data in EURM from 1/12/217 to 3/11/, Bloomberg, Lyxor. counterparties or professional clients within the meaning of markets in financial instruments directive 24/39/ce.

1 ETF Research Team Marlène Hassine Konqui Head of ETF Research +33 1 42 13 59 56 marlene.hassine@lyxor.com Kristo Durbaku ETF Research Analyst +33 1 57 29 25 96 kristo.durbaku@lyxor.com Check out the Alpha/Beta Allocator Q3 Read more Read the full 217 analysis on active and passive performance Read more Analysing active & passive fund performance What 217 results tell us about portfolio construction FOR PROFESSIONAL AND QUALIFIED INVESTORS ONLY This document is reserved and must be given in Switzerland exclusively to Qualified Investors as defined by the Swiss Collective Investment Scheme Act of 23 June 26 (as amended from time to time, CISA). LYXOR ETF Research Contact us ETF.Research@Lyxor.com +33 ()1 42 13 59 56 counterparties or professional clients within the meaning of markets in financial instruments directive 24/39/ce.

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