The OFC Market Report

  Active, Crypto Take Center Stage in Global ETF Landscape According to the Trackinsight Survey By Steven Orlowski, CFP, CNPR May 25, 2025 In a notable shift in investor preferences and market dynamics, active exchange-traded funds (ETFs) and cryptocurrency-themed ETFs are gaining prominence worldwide, according to the latest annual Global ETF Survey conducted by Trackinsight in collaboration with J.P. Morgan Asset Management and State Street. The survey, which polled over 500 professional investors across Europe, North America, Asia-Pacific, and the Middle East, revealed that more than 40% of institutional and professional ETF users plan to increase their allocations to active ETFs over the next 12 months. This marks a significant pivot from the historically passive nature of the ETF market, suggesting that investors are looking for strategies that can navigate increasingly complex macroeconomic and geopolitical conditions. Active ETFs Break Through Traditionally dominated b...

  A Case Study in Mismatched Fund Returns Why Do a Fund’s Returns Sometimes Differ from Its Underlying Index? A Longstanding Legal Principle Holds the Key By Steven Orlowski, CFP, CNPR In the world of investing, index funds are often promoted for their simplicity, cost-effectiveness, and transparency. The pitch is compelling: by mirroring the performance of a benchmark index like the S&P 500, investors can achieve broad market exposure without the risks and costs associated with active management. However, a curious phenomenon sometimes puzzles investors. Even when a fund is designed to track an index, its returns don’t always match the performance of that index. The discrepancies are usually small—fractions of a percent—but occasionally they are large enough to raise eyebrows. Why does this happen? At first glance, the mismatch might seem like an operational error or hidden fee structure. But in many cases, the answer lies in a lesser-known but longstanding legal and acco...

  Amid the Volatility, These High-Quality Assets Have Attractive Valuations — and Solid Yields In today's turbulent market environment, where inflation remains sticky, interest rate policy is uncertain, and geopolitical tensions continue to flare, many investors are searching for a safe harbor. Volatility has returned with a vengeance, pushing some investors to the sidelines — but for those willing to look past the noise, a compelling opportunity is emerging: high-quality assets trading at attractive valuations, offering both capital appreciation potential and robust income streams. The Market Backdrop: Uncertainty Breeds Opportunity Equity markets have been on a roller coaster ride in recent quarters, swinging between optimism over AI-driven productivity gains and pessimism around global growth prospects. Bond yields have surged, cooled, and surged again, reflecting shifting expectations about central bank policy. Against this backdrop, many quality companies — those with strong b...