ETF Prime: 2021's Top ETF Stories & What's to Come in 2022

On this week’s episode of ETF Prime, host Nate Geraci is joined by president of ETF Trends and ETF Database, Tom Hendrickson, to discuss the most popular stories of the year. Similarly, Morningstar’s Ben Johnson also offers his thoughts on 2021’s biggest news stories, along with his predictions for 2022. Finally, Toroso’s Michael Gayed puts the spotlight on rotation ETFs RORO and JOJO.

As investors and advisors near the end of 2021, it is exciting to look back at all that occurred in the past 12 months. Hendrickson shares with Geraci the five most-read stories on ETF Trends and ETF Database, along with which five ETFs were the most popular this year.

The most popular stories include our coverage of Tesla, including ARK’s investment in the company and the controversial business choices of Tesla’s founder, Elon Musk. “The advisor community continues to look at what ARK Invest is doing, how they approach their allocations, and Tesla is obviously a great gateway to take a look under the hood of the rest of the ARKK holdings,” Hendrickson adds.

Another story was focused on the history of the S&P 500, which was an article first published back in 2014, but there’s plenty about the information that remains relevant today. Clearly, advisors are looking for this type of information on an ongoing basis. “To bridge that gap will be a great way to deliver on value based on what advisors are looking at,” Hendrickson adds.

Another top theme was ESG, as showcased by an article that touched on the rise of ESG in general, the amount of funds being created, and what the exposure will look like in certain market environments.

As far as the top ETFs go, there’s QQQ, BLOK, and ARKK, among others.

A Year of Record-Setting Launches

Later on, Ben Johnson, director of global ETF research at Morningstar, brings his own perspective on which ETF stories were the most notable of the year, along with his predictions for 2022. His choices differ compared to Hendrickson’s, but there’s plenty to cover in such a flow-filled year.

Among Johnson’s picks include coverage of the first bitcoin futures ETFs; record flows into the ETF space, which now stand at roughly $900 billion for the year; and the first mutual fund to ETF conversions. As Johnson explains, “A bigger picture of what we’re seeing is that ETFs, as a category, are becoming increasingly porous. What more investors and assets managers are realizing is how this is a better way to package and distribute investment strategies of all sorts.”

Johnson continues, “It’s a better way for investors to consume investment strategies. It’s more widely available. It’s more cost-efficient. It’s more tax-efficient. It’s an overall better deal for investors.” The overarching trend is this record-setting number of new launches. ETFs are the choice of a new generation, and that’s a very important thing to keep in mind going forward.

Lastly, Geraci is joined by Michael Gayed, portfolio manager at Toroso Investments. Gayed also publishes “The Lead-Lag Report,” a daily market newsletter. He’s the portfolio manager for the ATAC U.S. Rotation ETF (RORO) and the ATAC Credit Rotation ETF (JOJO) specifically, both of which rely on market signals to determine whether to go risk-on or risk-off in both stocks and bonds.

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