State Street to Enter Active ETFs in Europe, Partnerships with Third-Party Managers Planned

State Street Investment Management plans to enter the European active ETF market, offering in-house strategies and partnering with third-party active shops. The $5.1 trillion asset manager will launch products in areas such as global equities, small caps, and high-dividend stocks. European defence ETFs have fallen amid growing speculation of a ceasefire in the Russia-Ukraine war. Several crypto ETP providers are eyeing UK listings after the Financial Conduct Authority lifted its retail ban on the products.

State Street Investment Management (SSIM) is set to make a significant foray into the European active ETF market. The $5.1 trillion asset manager, known for its extensive global reach, is planning to introduce both in-house strategies and partner with third-party active shops to co-develop products. This move comes in response to growing client demand for active ETFs in the region [1].

SSIM will focus on developing active ETFs with exposure to global equities, small-cap stocks, and high-dividend paying stocks. These products aim to complement the firm's existing passively managed dividend aristocrats range. Additionally, SSIM is considering the development of derivative overlays to further enhance its product offerings [1].

In the realm of fixed income, SSIM is exploring partnership agreements with third-party active managers, recognizing the increasing opportunities in this area. The firm has successfully used the partnership model in the US, collaborating with Apollo Global Management on its private credit ETF and Bridgewater Associates on a risk parity strategy [1].

Meanwhile, European defense ETFs have experienced a downturn amidst growing speculation of a ceasefire in the Russia-Ukraine war. The WisdomTree Europe Defense UCITS ETF (WDEF), the largest defense ETF in Europe with $3.4 billion in assets under management, saw a sharp decline between 6 and 11 August, dropping 7.2% [2]. Other European defense ETFs, such as the Future of European Defence UCITS ETF (ARMY) and the Amundi Stoxx Europe Defense UCITS ETF (DEFS), also experienced significant losses, mirroring the broader market sentiment [2].

The recent performance of European defense ETFs is closely tied to the upcoming summit between US President Donald Trump and Russian President Vladimir Putin. The fate of these ETFs is heavily hinged on the outcome of the summit, with markets eagerly awaiting any developments that could impact the ceasefire speculation [2].

Separately, several crypto ETP providers are eyeing UK listings following the Financial Conduct Authority's lifting of its retail ban on the products. This development could open up new opportunities for crypto investors in the UK market [3].

References:
[1] https://www.etfstream.com/articles/state-street-plots-big-push-into-active-etfs-in-europe
[2] https://www.etfstream.com/articles/european-defence-etfs-fall-on-ceasefire-hopes-in-russia-ukraine-war
[3] https://www.etfstream.com/articles/crypto-etps-eye-uk-listings-after-fca-lifts-ban