Peter Barnes

The total spending on Visa’s (V) network rose 11% to $2.1 trillion in the second quarter—slightly better than analysts’ estimates of $2.09 trillion.

BBJP was the star ETF last week. BBJP is the second-fastest ETF to reach the $1 billion mark after the SPDR Gold Trust (GLD).

The top five US banks’ trading revenues rose 10% in the second quarter to over $20 billion—compared to $18.55 billion in the same period last year.

Even though broader markets remained flat last week, US financials rose due to strong earnings growth from leading banks.

The rise in US stocks to more than a five-month high prompted investors to put money into ETFs. US-listed ETFs added $8.5 billion last week.

According to FactSet data, US-listed ETFs had inflows worth $770 million last week. Now, the year-to-date inflows are $121 billion.

FactSet data showed that ETFs posted net outflows of $21.6 billion during the week, which pushed the year-to-date inflows down to $129.4 billion.

The LDR ratio for the largest US banks—JPMorgan Chase, Bank of America, Wells Fargo, Citigroup, and U.S. Bancorp—rose in the first quarter.

FactSet data showed that US-listed ETFs garnered inflows worth $7.5 billion during the week. Now, the year-to-date inflows are $142.5 billion.

Big US banks (VFH) have cleared the Fed’s latest stress test. The test measures banks’ ability to withstand an economic crisis.

After eight weeks of continuous inflows, ETF flows faltered last week despite positive momentum in the markets.

According to the Federal Reserve, consumer credit slowed to an annual growth rate of 2.9% or $9.3 billion in April—compared to 3.8% in March.

According to Jefferies, JPMorgan Chase only had $6.7 billion of exposure to Italy at the end of 2017, while Bank of America had $5.4 billion.

Fitch Ratings says that easing the Dodd-Frank Act for smaller and custodial banks could be negative for some banks’ credit profiles in the long term.

Wells Fargo discovered that employees in its wholesale unit altered information related to customers’ records without the company’s knowledge.

According to FactSet, investors added $3.5 billion to US-listed ETFs last week. Now, the year-to-date inflows are $90.4 billion.

Morgan Stanley reported an EPS of $1.45 in 1Q18—compared to expectations of $1.25. Morgan Stanley’s revenue was $11.1 billion.

The latest economic data and renewed geopolitical concerns failed to thwart ETF inflows last week.

JPMorgan Chase (JPM) reported an EPS (earnings per share) of $2.37 in 1Q18—compared to the consensus estimate of $2.28.

The uncertainty created by the US-China trade war continues to impact ETF inflows. Investors withdrew $3 billion out of US-listed ETFs last week.

The five largest US investment banks garnered more than $15.2 billion in fees from debt capital market activities in 2017.

The New York Attorney General fined Bank of America due to a fraudulent “masking” scheme in the bank’s electronic trading division.

US stocks ended lower last week amid political uncertainty. Strong industrial production data didn’t boost the markets.

The SPDR S&P 500 ETF Trust (SPY) was responsible for all of the outflows from US equity. SPY experienced net redemptions of $12.7 billion.

US stock markets rallied last week after February’s jobs report was better than expected. Non-farm payrolls rose by 313,000 in February.

The VanEck Vectors Gold Miners ETF (GDX) raked in $610.1 million. SMH also saw substantial inflows of $552.8 million.

Localized geopolitical risks like the tension in the Middle East are unlikely to cause substantial damage to the markets in the long run, though they could bolster oil prices in the short term.

While North Korea and South Korea (EWY) have initiated talks recently, North Korea’s nuclear ambitions mean that tensions will always remain in the region despite temporary overtures of peace from both sides.

The biggest political risk to markets could arise from a trade war that has been playing out ever since Donald Trump came to power.

The S&P 500 Index plunged 4.6% during the first four trading days of February, while the Dow Jones Industrial Average and the NASDAQ Composite Index dipped 4.7% and 4.0%, respectively.

After registering the strongest inflows in January, ETFs witnessed huge outflows last week. The YTD inflows have fallen to $51.9 billion.

AIG (AIG) reported a net loss of $6.66 billion in 4Q17—compared to a loss of $3 billion in 4Q16.

Broader markets posted a sharp drop and the financial sector saw more losses. The S&P 500 financial index fell 5.80% and closed at 458.95.

The International Monetary Fund expects the US economy to grow 2.7% in 2018 and 2.5% in 2019. The global economy is expected to expand 3.9% in both 2018 and 2019.

The ultra-loose monetary policies that have been in vogue for many years have helped jack up prices of all the asset classes.

A sharp rise in the market (VOO) was driven by economic optimism fueled by a rebound in economic growth, improving corporate earnings, government reform initiatives, and higher liquidity.

SPY, the world’s largest ETF, continued to receive huge inflows. After adding $7.8 billion the previous week, it added another $6.2 billion last week.

Despite the $32.9-billion hit the top five banks took in their fourth-quarter earnings, US banks (XLF) are generally very positive about the new tax plan.

Last week, US stocks closed the week on a very strong note mainly driven by strong earnings growth. All 11 sectors in SPY reported positive earnings growth.

SPY continued to be the big winner of the week with inflows of $7.8 billion. SPY’s total assets under management have reached $292 billion.

Morgan Stanley (MS) reported an EPS of $0.84 in 4Q17. Its earnings exclude a one-time $990 million hit resulting from recent changes to the US tax code.

ETFs started 2018 on a very promising note. According to FactSet, the total ETF inflows amounted to $5.32 billion for the first week of the year.

With the addition of $475 billion, ETF inflows have broken all of the records in 2017. The previous record was $287.5 billion in 2016.

Over the past two years, Verizon has boosted its presence in online advertising, streaming videos, and adjacent wireless markets by acquiring a number of companies.

International Business Machines (IBM), a leading enterprise solutions provider, has seen its revenue decline consistently for the past 22 quarters.

The Dow has risen 88.5% since December 2012. Except for Merck (MRK) and Verizon (VZ), the laggards delivered negative returns during that period.

Last week, the SPDR S&P 500 ETF Trust (SPY) was the biggest winner with inflows worth $4.63 billion.

US financial stocks hold a lot of promise going into 2018 due to strong economic growth and the expected rise in interest rates.

Last week, the real stars were smart beta ETFs that saw strong inflows after many weeks. MTUM and USMV added $847.5 million and $829 million.

According to Lipper data, US-based stock ETFs (exchange-traded funds) saw inflows worth $9.4 billion last week even as the markets (SPY) continued to see record highs.

ETFs saw another week of record inflows even though the markets fell slightly for the second consecutive week. ETFs added $5.4 billion last week.

Over the years, the largest US banks (XLF) have followed different approaches to their equity and FICC (fixed income, currencies and commodities) trading.

According to FactSet, $3.7 billion worth of inflows were added in the ETF last week, which takes the year-to-date total to $388.2 billion.

FactSet data show that $16.2 billion worth of inflows were added in the ETF last week, which takes the YTD (year-to-date) total to $384.3 billion.

As the broader stock indexes continued to make new highs, ETFs also continued to witness record inflows.

US stocks are rising due to hopes that the Trump Administration will complete a tax deal in the near future that will substantially benefit corporates.

So far, banks that reported their 3Q17 earnings showed mixed trends. JPMorgan Chase’s revenue and earnings comfortably beat consensus estimates.

During a press conference last week, Federal Reserve Chair Janet Yellen criticized Wells Fargo (WFC) for its fake account scam.

Several large US banks and credit card companies reported a rise in credit card delinquency rates for August—the second rise after falling for four months.

The iShares NASDAQ Biotechnology ETF (IBB) offers investors targeted exposure to biotechnology and pharmaceutical stocks listed on the NASDAQ.

The iShares NASDAQ Biotechnology ETF (IBB) is an open-end fund with assets under management of $9.85 billion.

The iShares NASDAQ Biotechnology ETF (IBB) aims to track the investment results of the NASDAQ Biotechnology Index, which comprises NASDAQ-listed biotechnology and pharmaceuticals companies.

The SPDR Gold Trust (GLD) added $873 million—gold prices rose to the highest level in a year. The largest outflow was witnessed in SPY.

The VanEck Vectors Semiconductor ETF (SMH) offers investors concentrated exposure to the global semiconductor industry.

The VanEck Vectors Semiconductor ETF (SMH) is an open-ended fund with assets under management of $774.0 million.

The VanEck Vectors Semiconductor ETF (SMH) is an ETF that aims to replicate the price and yield performance (before fund fees and expenses) of the MVIS US Listed Semiconductor 25 Index.

HACK follows a replication strategy, which is an indexing strategy that involves investing in securities in the same proportions as the index.

The ETFMG Prime Cyber Security ETF (HACK) is an ETF (exchange-traded fund) that tracks the price and yield performance of the Prime Cyber Defense Index.

In 2Q17, the five largest US banks originated residential mortgages worth $112.0 billion, which was higher than $96.0 billion in 1Q17 but well below $129.0 billion in 2Q16.

Major banking stocks rose after the Fed approved huge payout plans. Wells Fargo (WFC) rose 2.7% and Citigroup (C) rose 2.8%.

As the middle class expands and discretionary incomes rise, emerging markets are feeling more strongly the impact of the web and mobile technologies.

In recent years, emerging markets have experienced rapid economic growth compared to developed markets.

In the previous articles of this series, we discussed population and economic growth as the two major drivers leading to a rise in emerging markets (EMQQ).

Achieving higher returns amid the rising market volatility, record-low interest rates, and global uncertainties is a huge challenge for investors.

On the commodities side, we have broad-based commodity benchmark, the Nasdaq Commodity Index, aptly named.

With the Dorsey Wright indices, we mentioned the Dividend Achievers (VIG) (DVY) and now this is more of a fundamental factor based suite of products.

So let’s move on to the AlphaDEX suite of products. Walk us through the construction of these products.

What products single out specifically the share buyback companies?

Let’s dive a little bit into the Alphadex® and Dividend Achievers products.

Historically, we have seen Buyback does perform very well across all interest rate environments. Looking at the data back to the mid-80s, it does well.

What is your definition of smart beta? I think there is some variation in this definition depending on who you ask.

As the middle class expands and discretionary incomes rise, the impact of the web and mobile technologies are felt more strongly in emerging markets.

Emerging market economies (EEM) have followed diverse trends that are likely to drive global growth in the coming decades.

Term life (IYF) is most beneficial to young adults who are relatively free from any financial responsibilities.

Term life insurance provides guaranteed benefits to beneficiaries for a specific period of time in case of the sudden death of the insured person.

Life insurance (PRU) (MET) policies come in various forms that cater to people in different age groups and with different financial goals.

Warren Buffett points to a likely conflict between traditional electric power (JXI) suppliers and renewable energy sources like solar and wind.

Berkshire Hathaway teamed up with 3G Capital, a Brazil-based investment firm, to buy H.J. Heinz in 2013 and Kraft Foods in 2015. This action formed a new merged entity, Kraft Heinz Company.

Buffett said that it has been a terrible mistake to bet against America, not only for the past 240 years but even now. He believes that America’s emphasis on innovation and strength in commerce will continue to provide strong gains for its people.

Berkshire Hathaway has reported an underwriting profit for 13 straight years, showing a pre-tax gain of $26.2 billion for the period. Buffett states that this was due to Berkshire’s insurance manager’s daily focus on disciplined risk evaluation.

Warren Buffett’s 2015 letter to Berkshire Hathaway shareholders is a mix of data, insight, and humor. Buffett aimed to dispel many allegations and misconceptions that have been lingering for quite some time.

To lower its effective borrowing costs and extend its maturity profile, GGP was active in unsecured and secured credit markets in fiscal 2015.

Minimum rent contributed to 60.1% of General Growth Properties’ total revenue in 4Q15.

Equity Residential upwardly revised its guidance for its 2016 same-store operating performance, normalized FFO per share, and some of its transactions.

In 2015, EQR was active in both the unsecured and secured credit markets to lower its effective borrowing costs and extend its maturity profile.

The CFPB’s mortgage disclosure form initiative has been created mainly to help consumers understand and select the best mortgages for them.

The Consumer Financial Protection Bureau was established to protect consumers’ interests by implementing federal consumer financial laws.

Among the 25 analysts following Simon Property stock, 20 have assigned a “buy” rating. The company received no “sell” ratings from any analysts while five brokerages have assigned a “hold” rating.

The total debt of Simon Property Group (SPG) increased from $20.8 billion as of the end of 4Q14 to $22.5 billion as of the end of 4Q15.

Simon Property Group (SPG) had 179 properties under US malls and premium outlets as of the end of 4Q15 compared to 177 as of the end of 4Q14.