A long list of fund managers looking to bring active funds to market
Vic Jokovic is chief executive of stock exchange Chi-X Australia. He is still cautious when it comes to COVID-19 and future valuations but he is also optimistic on the potential for more listed funds on Chi-X.
Vic Jokovic is chief executive of stock exchange Chi-X Australia. He is still cautious when it comes to COVID-19 and future valuations but he is also optimistic on the potential for more listed funds on Chi-X.
What kind of volumes have you noticed during the past three months?
The VIX hit what would have been close to all time highs back in March.
And with that if you go back to March, and a peak of a lot of the panic and fear, we did see volumes that were unprecedented. We had volumes on most days that were two to three times normal values.
The peak of activity was on the 13 March 2020 with 7.1 million trades, 2.1 million of those trends were executed on Chi-X.
What trends have you observed?
The scale or the ramp up of new retail clients coming into the market for the first time.The large online brokers - CommSec, nabtrade and others - have seen a significant increase in the number of new clients coming to the market.
And we've seen some pretty spectacular divergence in sector performance as well, much more than what we saw with the GFC. You've seen the real COVID winners - tech names, some of the online retailers, pharmaceuticals - and then you've had the losers - the REITS, in particular the banks and any stocks involved in the travel industry.
What's happening with managed funds on Chi-X?
One part of the reason we extended our product base into listed funds and listing active funds was that there is a growing appetite for active fund managers to give access to their active funds in a listed way.
We've listed five actively managed fixed income funds and we have another one coming in a few weeks time. We also have a very very long list of other Australian and global fund managers looking to bring active funds to market.
You've recently added to your TraCRs (transferable custody receipts) for US companies, and now have 35. Which TraCRS have seen the biggest inflows?
We started with Apple ... but interestingly Berkshire Hathaway would have seen the most trades. Disney has had a lot of trades.
It is ramping up and we are seeing more interest on a monthly basis right across the TraCRs.
Where do you see markets going from here?
The risks haven't gone away and the Covid virus is alive and well and will continue to create uncertainty. Our key trading partners are in trouble and the one key trade partner that isn't we have a bit of a trade issue with.
I feel [we] shouldn't get ahead of ourselves in terms of forward valuations.
