Active ETF Market Share Update & Weekly Market Review

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AdvisorShares Active ETF Market Share Update – Week Ending 8/23/2013

Last week, total AUM in all active ETFs increased by over $69 million. As in previous weeks, assets in “Short Term Bond” active ETFs increased, this time by almost $64.6 million. AUM in the “Foreign Bond” category fell by nearly $58 million both because of falling values for ETFs in the category and because redemption units in certain ETFs. The “Global Bond” category had another bad week, ending over $18.3 million below where it began. The “Alternative Income” category had another great week, as its AUM increased by nearly $41.8 million, while the “Alternative” active ETF category added $13.16 million. As in previous weeks, the “Currency” category declined in value, this time by around $6.6 million. Finally, the smaller categories of “High Yield” and “US Equity” grew at $10 million and over $22 million respectively due to creation units in ETFs in those two categories.

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Highlights of the Prior week

For the week of August 19 – August 23

Stock Markets

Most US stock indexes (the exception being the Dow Jones Industrial Average) finished the week slightly higher as good economic data and corporate earnings numbers offset concerns about rising interest rates. Both the S&P 500 and the Dow Jones Industrial average had their longest streaks of daily loses for the year. The S&P 500’s 4 day losing streak ended on Monday, while the Dow Jones Industrial average didn’t snap its 6 day stretch of losses until Thursday (the most consecutive down days in 13 months). The Fed released minutes from its July 30-31 meeting on Wednesday, which gave more evidence that it start scaling back on its assets purchases by as soon as September. On Thursday, a computer glitch caused the Nasdaq to stop trading for 3 hours in the afternoon. Economic news for the week was mostly benign. Jobless claims of 336,000 pointed to a continued improvement in the labor market, while the Markit flash PMI increased to 53.9. While new home sales for July came in at their lowest level in 3 year (394,000 sales), existing home sales rose to 5.39 million. A moderate cooling of the housing market is to be expected given that mortgage rates have recently risen from their historic lows.

Bond Markets

Treasury inflation protected securities (TIPS) underperformed traditional Treasury bonds again, as prices have fallen by over 9% since the year began. Surprisingly though, Thursday’s $16 billion auction of 5-year TIPS received strong demand as the inflation-adjusted yields were more attractive than in previous auctions. US Treasury yields rose for most of the week, but bond prices increased enough on Friday that they ended the week with lower yields than they had at the beginning. In fact, the 10-year Treasury yield hit a new two-year record high after the Fed released minutes from its July 30-31 meeting on Wednesday. While high yield corporate bonds and municipal bonds underperformed for the week (especially debt issues with longer-maturities), floating rate bank debt saw price gains as investors are attracted to the low interest rate sensitivity of these debt instruments.

WMU 8.28.13 - chart 2WMU 8.28.13 - chart 1


*Index information is from Reuters and Yahoo! Finance 4pm closing data

*Gold prices are from EcoWin and J.P. Morgan Asset Management

*Treasury rates are from

*Municipal and high yield rates are from Barclays Capital

This document should not be considered investment advice and the information contain within should not be relied upon in assessing whether or not to invest in any securities or asset classes mentioned. This document has been prepared without regard to the individual financial circumstances and objectives of persons who receive it. The securities discussed in this document may not be suitable for all investors.

This material was compiled by AdvisorShares Investments, LLC (“AdvisorShares”), an SEC-registered investment adviser and was based on publically available data at the time of compilation. AdvisorShares makes no warranties or representation of any kind relating to the accuracy, completeness or timeliness of the data and shall not have liability for any damages of any kind relating to the use such data. This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results.

The indices included herein are unmanaged indices and one cannot directly invest in an index. Index returns do not reflect the impact of any management fees, transaction costs or expenses. The index information included herein is for illustrative purposes only.

There are risks involved with investing in ETFs, including possible loss of principal. Shares are actively managed and are subject to risks similar to stocks, including those related to short selling and margin maintenance. Ordinary brokerage commissions apply.

Shares are not individually redeemable and owners of the shares may acquire those shares from the Funds and tender those shares for redemption to the Funds in Creation Unit aggregations only, typically consisting of 50,000 shares.

AdvisorShares® is a registered trademark of AdvisorShares Investment, LLC. The trademarks and service marks contained herein are the property of their respective owners..

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