Fintech News: July 15th, 2016

Vanguard, the Unlikely Savior of Active Management (Vanguard)

Actively managed mutual funds have seen $76 billion in outflows since January, except for Vanguard. While Vanguard has established itself as the Walmart of passively-managed funds seeking to match the market (rather than beat it,) its actively managed funds have seen net inflows while its competitors have floundered. The secret? An average expense ratio of .27%, compared to the competition’s .79%.

-1x-1

Money is flowing from high-fee to low-fee, not necessarily passive to active funds.

$XBTC is the first Bitcoin ETF (Finextra) (Finextra)

bitcoin-and-ethereum-sitting-on-a-tree@2xThe first bitcoin ETF may soon become a reality, allowing investors to trade bitcoin just how they trade a stock. Critics say that defeats the purpose of bitcoin, since the virtual currency derives its value outside of government-backed currencies.

Slump Might Turn Anti-Bank SoFi Into a Bank (Wall Street Journal)

OG-AH685_201607_G_20160711182427SoFi’s CEO once called traditional banks “the second biggest waste of human capital outside the IRS.” Now, as venture capital dries up in lending, he might have to act like a bank to compete with them. This includes seeking regulatory approval in certain states, offering credit cards, and partnering with giant financial institutions.

38 Fintechs Raised $300 Million in June (Finovate)

Fintechs are raising 100% more money and closing 90% more funding rounds than they did in 2015. This June, in investing: Smartkarma, for Asian investment research; Macrovue, for theme-based investing, Sernova Financial for clearing services.

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