ETP Marketplace Highlights November
Highlights from the Month November Product Evolution Launches: 46 New Filings: 32 Announced Modifications*: 1 Announced Closures: 2 Vanguard Active Factor ETP Filings Vanguard filed for 6 actively-managed factor-based ETPs Franklin Country ETP Launches Franklin Templeton launched a suite of the lowest cost single country-focused ETPs Blockchain ETP Filings Five separate issuers filed for blockchain-focused ETPs Oppenheimer Factor Launches Oppenheimer launched 8 factor-based strategies, including 2 dynamic multi-factor ETPs WisdomTree Buys ETF Securities Unit WisdomTree announced the acquisition of ETF Securities commodity, currency and shortand leveraged European ETP business * Modifications refer to index changes, name changes, OER reductions, advisor/sub-advisor changes, etc. Only ETPs and affiliated ETPs within the same product suite with AUMs > $250M are covered in Modifications See Appendix for a list of launches, filings, modifications, closures and exemptive relief applications and grants and the sources for such information Please see the final slide for definitions ETP Marketplace Highlights: November Charles Schwab Investment Management, Inc. For Institutional Use Only 1
Assets and Flows November 30, Total ETP AUM November ETP AUM Change November ETP Net Flows YTD ETP Net Flows* Assets: $3.36 Trillion Assets: $90.5 Billion Flows: $35.5 Billion Flows: $424.4 Billion Assets ($B) $3,500.0 $3,400.0 $3,300.0 $3,200.0 $3,100.0 $3,000.0 $2,900.0 $2,800.0 $2,700.0 $2,600.0 $2,500.0 $2,558.6 December 2016 $2,643.3 January $2,768.0 February $2,813.0 March $2,878.4 April $2,932.1 May $2,978.4 June $3,060.0 $3,081.7 July August $3,154.3 September $3,267.2 October $3,357.7 November Flows ($B) $70.0 $60.0 $50.0 $40.0 $30.0 $61.5 $40.8 $46.0 $47.9 $34.8 $32.7 $45.5 $24.6 $29.9 $28.2 $54.9 $35.5 $20.0 $10.0 $0.0 December 2016 January February March April May June July August September October November *YTD flows according to ETF.com s November Monthly ETF Flows Report, published on December 1,. YTD flows may differ from aggregated flows from prior months, which may result from adjustments made to monthly flows after each Monthly ETF Flows Report was issued by the data provider. Any such adjustments are not reflected in the monthly flows chart. Source: ETF.com and FactSet, as of November 30, ETP Marketplace Highlights: November Charles Schwab Investment Management, Inc. For Institutional Use Only 2
Top 20 League Table and Vanguard dominated inflows in November, capturing over 83% of all net flows, while State Street saw nearly $3 billion in outflows Global X saw significant inflows, measured as a percentage of its total AUM, while Deutsche Bank reversed some of their recent outflows and jumping up a spot on the leaderboard 11/30/17 10/31/17 M-O-M Change YTD Rank in Rank Sponsor AUM % of Total AUM % of Total in AUM Net Flows Net Flows (% of Total) Net Flows 1-1,334,378.9 39.7% 1,294,667.0 39.6% 39,711.9 18,524.6 52.2% 196,662.3 2 - Vanguard 837,247.9 24.9% 812,325.3 24.9% 24,922.6 11,002.8 31.0% 128,835.1 3 - State Street Global Advisors 587,436.4 17.5% 577,521.4 17.7% 9,915.0-2,924.6-8.2% 12,127.5 4 - PowerShares 139,002.6 4.1% 135,909.4 4.2% 3,093.2 1,297.5 3.7% 10,846.5 5 - Schwab ETFs 95,162.6 2.8% 91,226.5 2.8% 3,936.1 2,053.6 5.8% 24,210.5 6 - First Trust 55,921.5 1.7% 53,898.4 1.6% 2,023.1 1,202.1 3.4% 8,190.2 7 - WisdomTree 46,785.6 1.4% 45,814.7 1.4% 970.9 496.5 1.4% 913.1 8 - Guggenheim 38,813.4 1.2% 38,335.4 1.2% 478.0-94.5-0.3% 3,296.3 9 - VanEck 33,620.9 1.0% 33,315.6 1.0% 305.3 138.9 0.4% 2,480.7 10 - ProShares 29,495.6 0.9% 29,115.4 0.9% 380.2 143.0 0.4% 2,842.0 11 - FlexShares 15,599.0 0.5% 15,259.4 0.5% 339.6 160.4 0.5% 2,535.2 12 - PIMCO 14,636.9 0.4% 14,650.9 0.4% -14.0 16.0 0.1% 1,935.1 13 +1 Deutsche Bank 13,461.6 0.4% 13,180.6 0.4% 281.0 294.7 0.8% -1,802.6 14-1 ALPS 13,124.0 0.4% 13,814.3 0.4% -690.3-12.6 0.0% 2,179.5 15 - Direxion 12,072.6 0.4% 12,055.1 0.4% 17.5-32.8-0.1% 495.0 16 - Fidelity 8,380.4 0.2% 7,989.2 0.2% 391.2 244.4 0.7% 2,216.0 17 - Global X 8,140.7 0.2% 7,374.7 0.2% 766.0 709.6 2.0% 3,952.9 18 +1 Barclays 7,075.5 0.2% 6,857.2 0.2% 218.3 198.8 0.6% 940.2 19-1 UBS 7,058.8 0.2% 7,141.1 0.2% -82.3-48.9-0.1% 184.3 20 - Goldman Sachs 6,339.4 0.2% 6,151.9 0.2% 187.5 68.8 0.2% 2,587.6 Source: ETF.com and FactSet, as of November 30, ETP Marketplace Highlights: November Charles Schwab Investment Management, Inc. For Institutional Use Only 3
Flows and Assets by Asset Class U.S. Equity led net inflows in November, pulling in close to $17 billion, bringing the asset category closer to International Equity in YTD net flows $35.5 billion flowed into ETPs in November, down from almost $55 billion in October Inverse ETPs experienced almost $302 million in outflows 11/30/ 10/31/ M-O-M Change YTD Asset Category AUM % of Total AUM % of Total Change in AUM Net Flows Net Flows U.S. Equity 1,868,603.5 55.7% 1,807,429.4 55.3% 61,174.1 16,875.4 146,107.0 International Equity 783,018.6 23.3% 760,728.0 23.3% 22,290.6 12,252.4 149,270.2 U.S. Fixed Income 519,581.9 15.5% 515,143.8 15.8% 4,438.1 5,135.3 104,091.3 International Fixed Income 57,059.6 1.7% 55,934.6 1.7% 1,125.0 1,015.2 15,611.9 Commodities 66,191.5 2.0% 65,568.3 2.0% 623.2-198.7 1,570.8 Currency 1,298.3 0.0% 1,398.8 0.0% -100.5-113.6-180.7 Leveraged 32,333.7 1.0% 30,991.6 0.9% 1,342.1 453.2 2,882.6 Inverse 16,549.9 0.5% 17,275.8 0.5% -725.9-301.9 1,982.3 Asset Allocation 8,827.9 0.3% 8,594.7 0.3% 233.2 169.1 1,535.0 Alternatives 4,258.9 0.1% 4,120.1 0.1% 138.8 221.3 1,546.0 Total: 3,357,723.9 100.0% 3,267,185.1 100.0% 90,538.8 35,507.5 424,416.3 Source: ETF.com and FactSet, as of November 30, ETP Marketplace Highlights: November Charles Schwab Investment Management, Inc. For Institutional Use Only 4
Top ETP Net Flows Low-cost S&P 500 Index-tracking ETPs IVV and VOO dominated inflows, while SPY saw nearly $5.3 billion in outflows First Trust s Technology (FXL) and Utilities (FXU) sector ETPs saw mixed flows, possibly stemming from changes in the Dorsey Wright Focus 5 ETF (FV), their popular fund-of-funds strategy Fixed Income ETPs accounted for half of the top 10 outflows list, led by TLT Top 10 Net Inflows Ticker Name Sponsor November AUM November Flows IVV ishares Core S&P 500 ETF 139,086.5 2,712.5 VOO Vanguard S&P 500 ETF Vanguard 81,598.6 1,897.5 IWM ishares Russell 2000 ETF 46,356.8 1,550.6 XLF Financial Select Sector SPDR Fund State Street Global Advisors 31,599.7 1,515.6 USMV ishares Edge MSCI Min Vol USA ETF 15,769.0 1,269.3 MTUM ishares Edge MSCI USA Momentum Factor ETF 5,877.0 1,186.3 IEFA ishares Core MSCI EAFE ETF 41,099.5 1,101.5 QQQ PowerShares QQQ Trust PowerShares 58,991.4 1,088.5 AGG ishares Core U.S. Aggregate Bond ETF 52,308.8 1,081.7 FXL First Trust Technology AlphaDEX Fund First Trust 1,642.4 946.7 Top 10 Net Outflows Ticker Name Sponsor November AUM November Flows SPY SPDR S&P 500 ETF Trust State Street Global Advisors 253,008.5-5,289.9 TLT ishares 20+ Year Treasury Bond ETF 6,917.3-1,355.7 FXU First Trust Utilities AlphaDEX Fund First Trust 356.1-854.5 JNK SPDR Bloomberg Barclays High Yield Bond ETF State Street Global Advisors 12,187.2-807.9 BIL SPDR Bloomberg Barclays 1-3 Month T-Bill ETF State Street Global Advisors 896.5-754.8 XLK Technology Select Sector SPDR Fund State Street Global Advisors 18,688.1-635.8 BKLN PowerShares Senior Loan Portfolio PowerShares 8,160.8-572.6 IEI ishares 3-7 Year Treasury Bond ETF 7,069.5-455.0 GLD SPDR Gold Trust State Street Global Advisors 34,643.1-450.2 IEUR ishares Core MSCI Europe ETF 2,648.6-379.3 Source: ETF.com and FactSet, as of November 30, ETP Marketplace Highlights: November Charles Schwab Investment Management, Inc. For Institutional Use Only 5
Disclosures Investors should consider carefully information contained in the prospectus or, if available, the summary prospectus, including investment objectives, risks, charges and expenses. You can obtain a prospectus by visiting https://www.schwabfunds.com or calling 1-877-824-5615. Please read the prospectus carefully before investing. Investment returns will fluctuate and are subject to market volatility, so that an investor s shares, when redeemed or sold, may be worth more or less than their original cost. Some specialized exchanged-traded funds can be subject to additional market risks. Unlike mutual funds, shares of ETFs are not individually redeemable directly with the ETF. Shares of ETFs are bought and sold at market price, which may be higher or lower than the net asset value (NAV). ETPs mentioned are for informational purposes and not an offer to buy or sell a particular security. Data here is obtained from what are considered reliable sources; however, its accuracy, completeness or reliability cannot be guaranteed. Schwab ETFs are distributed by SEI Investments Distribution Co (SIDCO). SIDCO is not affiliated with Charles Schwab Investment Management, Inc., or any of its affiliates. Charles Schwab Investment Management, Inc. All rights reserved. 1217-7U2S MKT75210-47 ETP Marketplace Highlights: November Charles Schwab Investment Management, Inc. For Institutional Use Only 6
Appendix November
ETP Launches Ticker Name Sponsor Exchange Net OER Launch Date RVRS Reverse Cap Weighted U.S. Large Cap ETF Exponential ETFs CBOE 0.29% 11/1/ FTVA Aptus Fortified Value ETF Aptus Capital Advisors CBOE 0.79% 11/1/ FFSG FormulaFolios Smart Growth ETF FormulaFolios CBOE 0.71% 11/1/ FFTG FormulaFolios Tactical Growth ETF FormulaFolios CBOE 1.00% 11/1/ FMHI First Trust Municipal High Income ETF First Trust NASDAQ 0.55% 11/3/ SDVY First Trust SMID Cap Rising Dividend Achievers ETF Frist Trust NASDAQ 0.60% 11/3/ FLAU Franklin FTSE Australia ETF Franklin Templeton NYSE Arca 0.09% 11/6/ FLCA Franklin FTSE Canada ETF Franklin Templeton NYSE Arca 0.09% 11/6/ FLFR Franklin FTSE France ETF Franklin Templeton NYSE Arca 0.09% 11/6/ FLGR Franklin FTSE Germany ETF Franklin Templeton NYSE Arca 0.09% 11/6/ FLHK Franklin FTSE Hong Kong ETF Franklin Templeton NYSE Arca 0.09% 11/6/ FLIY Franklin FTSE Italy ETF Franklin Templeton NYSE Arca 0.09% 11/6/ FLJP Franklin FTSE Japan ETF Franklin Templeton NYSE Arca 0.09% 11/6/ FLGB Franklin FTSE United Kingdom ETF Franklin Templeton NYSE Arca 0.09% 11/6/ FLEE Franklin FTSE Europe ETF Franklin Templeton NYSE Arca 0.09% 11/6/ FLEH Franklin FTSE Europe Hedged ETF Franklin Templeton NYSE Arca 0.09% 11/6/ FLJH Franklin FTSE Japan Hedged ETF Franklin Templeton NYSE Arca 0.09% 11/6/ FLKR Franklin FTSE South Korea ETF Franklin Templeton NYSE Arca 0.09% 11/6/ FLBR Franklin FTSE Brazil ETF Franklin Templeton NYSE Arca 0.19% 11/6/ FLCH Franklin FTSE China ETF Franklin Templeton NYSE Arca 0.19% 11/6/ Sources: NYSE Arca, BATS, NASDAQ, Strategic Insight, FUSE, ETF.com, Morgan Stanley Smith Barney, Ignites, ETFTrends and Company websites ETP Marketplace Highlights: November Charles Schwab Investment Management, Inc. For Institutional Use Only 8
ETP Launches (Cont d) Ticker Name Sponsor Exchange Net OER Launch Date FLMX Franklin FTSE Mexico ETF Franklin Templeton NYSE Arca 0.19% 11/6/ FLTW Franklin FTSE Taiwan ETF Franklin Templeton NYSE Arca 0.19% 11/6/ ENTR Entrepreneur 30 Fund EntrepreneurShares NYSE Arca 0.49% 11/8/ JDIV JPMorgan U.S. Dividend ETF J.P. Morgan NYSE Arca 0.12% 11/9/ JMIN JPMorgan U.S. Minimum Volatility ETF J.P. Morgan NYSE Arca 0.12% 11/9/ JMOM JPMorgan U.S. Momentum Factor ETF J.P. Morgan NYSE Arca 0.12% 11/9/ JQUA JPMorgan U.S. Quality Factor ETF J.P. Morgan NYSE Arca 0.12% 11/9/ JVAL JPMorgan U.S. Value Factor ETF J.P. Morgan NYSE Arca 0.12% 11/9/ DIVB ishares U.S. Dividend and Buyback ETF CBOE 0.25% 11/9/ EMEM Virtus Glovista Emerging Markets ETF Virtus NYSE Arca 0.68% 11/9/ JHSC John Hancock Multifactor Small Cap ETF John Hancock NYSE Arca 0.50% 11/9/ VTC Vanguard Total Corporate Bond ETF Shares Vanguard NASDAQ 0.07% 11/9/ OMFL Oppenheimer Russell 1000 Dynamic Multifactor ETF Oppenheimer CBOE 0.29% 11/10/ OMFS Oppenheimer Russell 2000 Dynamic Multifactor ETF Oppenheimer CBOE 0.39% 11/10/ OMOM Oppenheimer Russell 1000 Momentum Factor ETF Oppenheimer CBOE 0.19% 11/10/ OQAL Oppenheimer Russell 1000 Quality Factor ETF Oppenheimer CBOE 0.19% 11/10/ OSIZ Oppenheimer Russell 1000 Size Factor ETF Oppenheimer CBOE 0.19% 11/10/ OVLU Oppenheimer Russell 1000 Value Factor ETF Oppenheimer CBOE 0.19% 11/10/ OVOL Oppenheimer Russell 1000 Low Volatility Factor ETF Oppenheimer CBOE 0.19% 11/10/ OYLD Oppenheimer Russell 1000 Yield Factor ETF Oppenheimer CBOE 0.19% 11/10/ Sources: NYSE Arca, BATS, NASDAQ, Strategic Insight, FUSE, ETF.com, Morgan Stanley Smith Barney, Ignites, ETFTrends and Company websites ETP Marketplace Highlights: November Charles Schwab Investment Management, Inc. For Institutional Use Only 9
ETP Launches (Cont d) Ticker Name Sponsor Exchange Net OER Launch Date PXUS Principal International Multi-Factor Index ETF Principal NASDAQ 0.39% 11/10/ PILL Direxion Daily Pharmaceutical & Medical Bull 3X Shares Direxion NYSE Arca 1.12% 11/15/ EMTY ProShares Decline of the Retail Store ETF ProShares NYSE Arca 0.65% 11/16/ CLIX ProShares Long Online/Short Stores ETF ProShares NYSE Arca 0.65% 11/16/ SPDV AAM S&P 500 High Dividend Value ETF Advisors Asset Management NYSE Arca 0.29% 11/29/ EEMD AAM S&P Emerging Markets High Dividend Value ETF Advisors Asset Management NYSE Arca 0.49% 11/29/ Sources: NYSE Arca, BATS, NASDAQ, Strategic Insight, FUSE, ETF.com, Morgan Stanley Smith Barney, Ignites, ETFTrends and Company websites ETP Marketplace Highlights: November Charles Schwab Investment Management, Inc. For Institutional Use Only 10
ETP Filings Name Amplify Blockchain Leaders ETF First Trust Indxx Blockchain ETF First Trust Nasdaq Artificial Intelligence and Robotics ETF Horizons Blockchain ETF Horizons Cadence Hedged US Dividend Yield ETF Impact Shares Cause Based ETF Impact Shares NAACP Minority Empowerment ETF Impact Shares YWCA Women's Empowerment ETF InnovationShares Blockchain Innovators ETF InnovationShares Next Generation Vehicles ETF ishares Evolved US Consumer Staples ETF ishares Evolved US Discretionary Spending ETF ishares Evolved US Financials ETF ishares Evolved US Healthcare Staples ETF ishares Evolved US Innovative Healthcare ETF ishares Evolved US Media and Entertainment ETF ishares Evolved US Technology ETF ishares Gold Exposure ETF ishares US Infrastructure ETF KraneShares Emerging Markets Healthcare Index ETF KraneShares Future Vehicle Index ETF Motley Fool 100 Index ETF PowerShares S&P 500 Rising Rates ETF Sponsor Amplify Investments First Trust Advisors First Trust Advisors Horizons Horizons Impact Shares Impact Shares Impact Shares Exchange Traded Concepts Exchange Traded Concepts KraneShares KraneShares Motley Fool Asset Management PowerShares Sources: NYSE Arca, BATS, NASDAQ, Strategic Insight, FUSE, ETF.com, Morgan Stanley Smith Barney, Ignites, ETFTrends and Company websites ETP Marketplace Highlights: November Charles Schwab Investment Management, Inc. For Institutional Use Only 11
ETP Filings (Cont d) Name Reality Shares Nasdaq Blockchain Economy ETF Vanguard US Liquidity Factor ETF Vanguard US Minimum Volatility ETF Vanguard US Momentum Factor ETF Vanguard US Multifactor ETF Vanguard US Quality Factor ETF Vanguard US Value Factor ETF Volshares Large Cap ETF Weatherstorm Real Estate ETF Sponsor Reality Shares Advisors Vanguard Vanguard Vanguard Vanguard Vanguard Vanguard Whitford Asset Management Exchange Traded Concepts Sources: NYSE Arca, BATS, NASDAQ, Strategic Insight, FUSE, ETF.com, Morgan Stanley Smith Barney, Ignites, ETFTrends and Company websites ETP Marketplace Highlights: November Charles Schwab Investment Management, Inc. For Institutional Use Only 12
Announced ETP Modifications AdvisorShares Announced on November 28,, a fee reduction in the following ETP, effective immediately Ticker Name Previous OER New OER AADR AdvisorShares Dorsey Wright ADR ETF 1.25% 0.99% Sources: NYSE Arca, BATS, NASDAQ, Strategic Insight, FUSE, ETF.com, Morgan Stanley Smith Barney, Ignites, ETFTrends and Company websites ETP Marketplace Highlights: November Charles Schwab Investment Management, Inc. For Institutional Use Only 13
ETP Closures O'Shares Announced on November 17,, the liquidation of the following ETPs. The last day of trading was November 30, Ticker OEUH OAPH Name O'Shares FTSE Europe Quality Dividend Hedged ETF O Shares FTSE Asia Pacific Quality Dividend Hedged ETF Sources: NYSE Arca, BATS, NASDAQ, Strategic Insight, FUSE, ETF.com, Morgan Stanley Smith Barney, Ignites, ETFTrends and Company websites ETP Marketplace Highlights: November Charles Schwab Investment Management, Inc. For Institutional Use Only 14
New Exemptive Relief Grants Reinhart Partners Granted exemptive relief to offer transparent, actively-managed ETFs Sources: SEC filings, Strategic Insight, FUSE, ETF.com, Ignites and ETFTrends ETP Marketplace Highlights: November Charles Schwab Investment Management, Inc. For Institutional Use Only 15
Definitions ETP (exchange-traded product) In addition to ETFs (exchange-traded funds), several other investment products are also exchange-traded and are therefore similarly categorized, including exchange-traded notes (ETNs), commodities, unit investment trusts (UITs), grantor trusts and limited partnerships. As ETFs represent the vast majority of these exchange-traded investment products, the term is often used as a catchall. Here, the label exchange-traded product (ETP) is used as the umbrella under which ETFs and other related investment products fall. ETMF (exchange-traded managed fund) ETMFs are a new type of open-end fund that combine aspects of both ETFs and mutual funds (MFs). ETMF shares are expected to trade throughout the day on an exchange, but unlike ETFs, trading prices are expected to be linked to the fund s end-of-day net asset value utilizing an approach called NAV-based trading and the current requirement of most ETFs to disclose their holdings daily is eliminated. ETMF providers require agreements with NextShares Solutions LLC, (NextShares), the Eaton Vance subsidiary formed to develop and commercialize NextShares. ETP Marketplace Highlights: November Charles Schwab Investment Management, Inc. For Institutional Use Only 16