ETF Chart of the Day: Dollar Dilemma

We have commented on the Currency ETP market and fund flow trends within it on several occasions in recent months, as there is rarely a dearth of action there given the impressive rise in the U.S. Dollar (UUP (PowerShares U.S. Dollar Index Bullish, Expense Ratio 0.80%)) in the trailing one year period (+>19%) versus other major currencies, the Euro and Japanese Yen included.

UUP has stutter stepped a bit along the way through March, but trading volume has never been higher in the fund historically than on several occasions throughout mid to late March, tapering off quite a bit into the early days of April here.

Year to date UUP has added more than $ 245 million to its asset base, totaling $ 1.33 billion currently and maintaining its lead as the largest Currency based ETP in the U.S. listed landscape.

Based on asset size and fund popularity, it looks like investors are still speculating on a higher Dollar versus other currencies, as the second largest Currency ETP is still the leveraged inverse EUO (ProShares UltraShort Euro, Expense Ratio 0.95%), which has $ 619 million in AUM but has seen flattish flows year to date. In keeping with this theme, the third largest Currency ETP is YCS (ProShares UltraShort Yen, Expense Ratio 0.95%), which has $ 440 million in AUM which has seen some trimming year to date (>$ 86 million out).

A newer entrant into the Currency space, USDU (WT Bloomberg U.S. Dollar Bullish, Expense Ratio 0.50%) has also made some noise since its December 2013 inception, pulling in more than $ 340 million in assets since its birth. USDU ranks as the fourth largest Currency ETP listed in the U.S. at the moment at its current asset size, ahead of the more seasoned FXE (CurrencyShares Euro Currency, Expense Ratio 0.40%, $ 264 million in AUM), with FXY (CurrencyShares Japanese Yen, Expense Ratio 0.40%, $ 89 million in AUM) well down on the list relative to AUM size compared with the aforementioned funds. Sadly we do not see UUPT (PowerShares DB 3X Long U.S. Dollar Index Futures ETN) nor UDNT (PowerShares DB 3X Short U.S. Dollar Index Futures ETN) listed anymore (since the middle of February of this year )due to a redemption of the notes by Deutsche Bank, as they might have received a good deal of attention given the continued volatility and heavy trading volume and interest in the U.S. Dollar linked ETF products.

PowerShares DB US Dollar Index Bullish Fund

For more information on Street One ETF market commentary and ETF trade execution/liquidity services, contact Paul Weisbruch at pweisbruch@streetonefinancial.com

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