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ETF watch: the hottest trends from Q3

ETF investors have been buying the dip but don't expect a cyclical recovery
ETF watch: the hottest trends from Q3
  • ETF investors are "buying the dip" in an unexpected place
  • But the value play appears to be faltering

So far this year, our quarterly round-ups of trends in the exchange traded fund (ETF) space have tended to mirror bigger challenges and opportunities in the markets. ETF investors attempted to navigate a series of market rotations, outsmart the inflationary threat and play some of the hottest future trends via the use of thematic funds.

Those challenges haven’t ebbed away in the third quarter (Q3). The latest figures suggest inflation may at the very least be more stubborn than some had initially assumed. Meanwhile, the tug of war between the growth and value investment styles has continued and an escalating regulatory crackdown in China has prompted urgent questions about a market that surged ahead in 2020 (see 'The China dilemma', IC, 24 september 2021). Yet ETF data suggests investors are responding to these developments in notably different ways.

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