Round 4: Focus on ETF business
After Round 4, we have our “Final Four”. This round was about focus, essentially how much of the firm’s business is focused on ETFs. There were two big upsets this round. Schwab #5 and Vanguard #2 fell to underdogs Direxion and Wisdom Tree. Also advancing are the number one seed iShares and eleven seed Flexshares.
Round 5: Revenue
In this round, we calculated each of the four issuers weighted average expense ratios and multiplied that by their AUM:
Ishares: 3,370 Million
Direxion: 124 Million
Flexshares: 63 Million
Wisdomtree: 218 Million
The surprise this time was Direxion again. Even though they have less AUM then Flexshares and WisdomTree, their revenue number was quite competitive. Unfortunately, they were on the side that had them competing with iShares which captures 43% of the 7.8 Billion in revenue produced by all US ETF issuers.
Drumroll…….Our final match is: Wisdom Tree vs iShares. Which of these two issuers best represents investable exposure to the growth of the ETF industry? We leave it to you to decide! Within TETFindex, we give both WETF and BLK our Top Tier weight equally, so we concur both are superb issuers.
This article was written by Toroso Asset Management, a participant in the ETF Strategist Channel.
Click here to see disclosures.