TD Ameritrade: Dave Nadig 2021 ETF Summary and 2022 Outlook
ETF Chief Information Officer and Chief Research Officer Dave Nadig was on hand for the TD Ameritrade Network on Wednesday to discuss the record year for ETFs and what to expect in the year. next with host Nicole Petallides.
Investors have indeed invested their money directly in ETFs last year, and it is important to take stock of what has happened. With things like BITO, JETS, and hotter trends throughout the year, Nadig points out that every time there is a crisis such as increased volatility or different performance of asset classes than expected; this is almost always good news for ETFs as a class.
So much money has entered the ETF market, and it has gone heavily into stocks. About 60% of the money went into stocks of some variety, most of it domestic stocks. This is partly why the market has just continued to climb. Nadig adds, “Even in the times of volatility we’ve had, I don’t see much to change as we approach next year.”
Given that funds have only climbed over the years, there really is no reason to believe that there will be a dramatic setback. 2021 has been the best year for ETFs, with the highest number of launches ever recorded in any given year.
– TD Ameritrade Network (@TDANetwork) December 21, 2021
What to do in 2022
Regarding what may be interesting by 2022, Nadig points to themes, which were huge this year. Thematic, referring to any fund that does not stick to a specific industry but tries to group stocks based on items seen in the headlines. Much of that money was spent on areas like thematic tech, referring to things like innovation. ARK Invest and ARKK, in particular, has been a big part of that story and saw some slowdown later in the year.
The other big theme of the year was ESG. Areas such as clean energy, finding ways to profit from attempts to tackle climate change, and other areas of social and governance have all been the big winners this year. This will probably continue next year as well.
Also, as Nadig notes, “I think we’re going to see a lot more active managers come into the fray. These thematic funds that I expect to see generate a lot of interest and assets – I don’t think they will be just simple index funds. I think we’re going to see a lot of active themes. They are going to come from small RAAs and large traditional active managers. I think it’s going to be an exciting year.
As for the bitcoin futures ETF launches that suddenly emerged at the end of this year, the appetite for these funds may continue to gain some assets. Still, it will be more interesting to see if they get a regulatory move.
Nadig adds, “I think there is going to be a lot of interest in crypto. There’s obviously going to be a lot of media frenzy around crypto, almost regardless of whether it’s going up or down a lot. I think one thing we can be absolutely sure of is that the crypto market won’t be boring in 2022. “