State Street Global Advisors’ latest report on the exchange-traded fund (ETF) market covering March activity found that 10 of 12 ETF categories gained in absolute terms.
According to the report, the Size and International categories accounted for 57% of the $54 billion in assets gained overall with bond ETFs leading in assets gained year to date, up $10.5 billion.
Large cap had by far the largest gain in equity assets, climbing $12.9 billion, followed by mid cap, up $2.5 billion. In terms of performance, Small and Mid Cap rose 8% and 7.7%, respectively.
Performance was relatively close between growth and value across each size segment. Year-to-date, value is outperforming growth in all size categories.
REITs, Financials, and Technology all had over $1 billion in asset gains for the month.
The top three U.S. ETF managers in March were: BlackRock, State Street, and Vanguard. Collectively, they accounted for approximately 84% of the U.S.-listed ETF market.
The top three U.S. ETFs in terms of dollar volume traded for the month were the SPDR S&P 500 [SPY], iShares Russell 2000 [IWM], and PowerShares QQQ [QQQQ].
The SPDR S&P 500 ETF [SPY] saw the most inflows, up $3.5 billion, followed by SPDR Gold Shares [GLD], up $828 million.
ERISA Advisory Council Calls for Retirement Commission
The Advisory Council on Employee Welfare and Pension Benefit Plans has called for the creation of a presidential commission to define a new national retirement policy and develop new structures for lifetime retirement security.
The panel, also referred to as the ERISA Advisory Council, included the presidential commission recommendation in a report that features a series of suggestions growing out of two public hearings conducted in July and September 2009.
The Council’s document stops short of calling for sweeping changes in the U.S. retirement savings system, saying instead that many changes will need to rest on formal government policy changes or Congressional legislation.
According to the report, the panel recommended formation of the presidential commission because the wide variety of suggestions it received about how to fix the current system’s problems convinced it of the need to formulate a new national approach to helping financially prepare Americans for their retirement.
“This (new) National Retirement Policy will need to consider the existing retirement structures offered by Social Security, employer provided benefits and retail (e.g., IRA) retirement vehicles as well as other economic factors that contribute directly to income security in retirement (e.g. retiree health care),” wrote panel members. “The policy also will need to focus on short-term and long-term objectives to achieve worker security.”
DoL Leadership
Other Council suggestions included:
The Department of Labor (DoL) “should take leadership in developing workers who are financially literate by facilitating, coordinating and collaborating with other government agencies, interagency councils, the private sector, professional organizations and academia to leverage all available support for the need to address financial literacy including promoting financial literacy as part of elementary education.”
The DoL should formally expand its scope to include not only the accumulation phase of retirement savings, but the decumulation as well. “Each of these phases taken individually, and then in the aggregate, must be considered to truly prepare all the stakeholders involved in retirement security,” the panel wrote. “The Presidential Commission must engage small, medium and large employers to encourage all employers to promote retirement security for their workers through all these phases. The policy needs to identify all available means, including when possible, increased use of electronic media, to encourage individual workers to understand and participate in retirement planning and security.”
Labor Secretary Hilda L. Solis “should champion the maintenance and expansion of the defined benefit system by convening an interagency task force to review and revise the current burdensome regulatory regime and by charging the (Pension Benefit Guaranty Corporation) to develop initiatives to encourage the continuation, maintenance, and expansion of voluntary private defined benefit pension plans.”
Regarding defined contribution plans, the DoL “should develop approaches to address participation disparities across racial, gender and ethnic groups. It should examine the role of race, gender and ethnicity on participation in voluntary plans to determine the best methods to ensure that diverse groups have equal opportunities to achieve retirement security.”
The Council heard from nine witnesses at a July 21, 2009, hearing and 13 at a September 16 session. The panel was created by ERISA to render advice to the DoL secretary.