COVID-19 has all of us concerned – for our families and friends, our employees and the investment returns people depend on. Our hearts go out to all who have been affected by the outbreak. While State Street has helped clients navigate challenging market environments from recessions to global conflicts to trade wars for more than 225 years, COVID-19 represents a new challenge that investors have not faced before. Therefore, I want to give you an update on the steps we are taking at State Street Global Advisors to ensure our teams around the world can continue to serve your needs.
Maintaining Business Continuity First and foremost, I want to assure you that we have strong and tested business continuity plans, including a Pandemic Response Policy, to prepare for situations like this. With operations around the world in segmented locations, we started to activate our continuity plans when the virus was first detected in China to ensure the health and safety of our employees and to maintain our operations.
Like many of you, we have already restricted travel, imposed quarantine periods for locations impacted, canceled conferences, and utilized business recovery locations. The majority of our employees world-wide will be on a remote work rotation program either working from home or at an alternate site.
Effectively Managing Your Investments Our investment focus remains on effectively managing the assets you have entrusted to us. We continue to see heightened volatility and reduced liquidity across all major asset classes. With portfolio management and trading teams across the globe, we have worked diligently to manage cashflows and monitor market conditions.
As one of the largest index fund providers, we have teams with deep experience accurately tracking indexes during volatile times, including managing thinly traded, less liquid securities. Our more than 100 indexing professionals are meeting frequently throughout each day to discuss everything from the timing of trades to liquidating positions to minimizing trading and transaction costs. Meanwhile, our active portfolio managers, including our quantitative, fundamental and multi-asset class teams, are selectively making changes to balance risk and return appropriate to their mandates.
Our SPDR ETF business, which includes many of the most liquid ETFs in the world1, has already demonstrated its resiliency multiple times, including after 9/11 when markets were closed for six days, the August 24th “Flash Crash” and other significant market events. It has done so again these past two weeks, where in the US, our ETFs have represented 42% of total industry ETF trading volumes2, providing an essential source of liquidity and price discovery. This has occurred while also navigating three market-wide circuit breakers and several limit-up / limit-down trading halts.
Sharing Our Market Insights & Expertise We are also increasing the volume and frequency of our market commentary to keep investors informed about market impact, the implication of policy responses and our macroeconomic and markets perspective. Last week, our Chief Investment Officer Rick Lacaille and other key investment leaders held a live panel to discuss the market environment, likely geopolitical responses and what it means for investors. Our thought leaders continue to offer insights through blogs, webinars and client newsletters on topics ranging from market volatility to central bank policy changes to oil price fluctuations and the impact of COVID-19 on specific geographies and industries. We have also been in close touch with regulators globally, sharing our insights and perspectives.
Our relationship management and investment teams are here to support you and your investment needs through this challenging period. Even in this era of social distancing, we are committed to staying connected to you via phone, WebEx, and other digital communications.
We will continue to stay in touch as this crisis continues. Please do not hesitate to reach out if we can be of assistance or if you have any concerns – and I hope that you, your family and your employees stay healthy and safe during this difficult time.
There are two things we know about all crises: each one is different and each one does end. This too shall pass.
1 Bloomberg Finance L.P., as of 1/10/2020. Based on 180 day dollar trading volume and geography focus of US Equities. Past performance is not a guarantee of future results. 2 Bloomberg, as of 3/11/2020.
Investing involves risk including the risk of loss of principal. The views expressed in this material are subject to change based on market and other conditions. This document contains certain statements that may be deemed forward-looking statements. All statements, other than historical facts, contained within this document that address activities, events or developments that SSGA expects, believes or anticipates will or may occur in the future are forward-looking statements. These statements are based on certain assumptions and analyses made by SSGA in light of its experience and perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances, many of which are detailed herein. Such statements are subject to a number of assumptions, risks, uncertainties, many of which are beyond SSGA’s control. Please note that any such statements are not guarantees of any future performance and that actual results or developments may differ materially from those projected in the forward-looking statements.
Issued by State Street Global Advisors, Australia Services Limited (AFSL Number 274900, ABN 16 108 671 441) ("SSGA, ASL"). Registered office: Level 14, 420 George Street, Sydney, NSW 2000, Australia · Telephone: 612 9240-7600 · Web: www.ssga.com.
State Street Global Advisors, Australia Services Limited (ASL) (AFSL Number 274900, ABN 16 108 671 441) is the issuer of interests and the Responsible Entity for the ETFs which are Australian registered managed investment schemes quoted on the AQUA market of the ASX or listed on the ASX. This material is general information only and does not take into account your individual objectives, financial situation or needs and you should consider whether it is appropriate for you. You should seek professional advice and consider the product disclosure document, available at www.ssga.com/au, before deciding whether to acquire or continue to hold units in an ETF. This material should not be considered a solicitation to buy or sell a security. ETFs trade like stocks, are subject to investment risk, fluctuate in market value and may trade at prices above or below the ETF's net asset value. ETFs typically invest by sampling an index, holding a range of securities that, in the aggregate, approximates the full index in terms of key risk factors and other characteristics. This may cause the fund to experience tracking errors relative to performance of the index. Investing involves risk including the risk of loss of principal. Diversification does not ensure a profit or guarantee against loss. Holdings and sectors shown are as of the date indicated and are subject to change. This information should not be considered a recommendation to invest in a particular sector or to buy or sell any security shown. It is not known whether the sectors or securities shown will be profitable in the future. Sector ETF products are also subject to sector risk and non-diversification risk, which generally results in greater price fluctuations than the overall market. SPDR and Standard & Poor's® S&P® indices are trademarks of Standard & Poor's Financial Services LLC and have been licensed for use by State Street Corporation. The Dow Jones Global Select Real Estate Securities Index is a product of S&P Dow Jones Indices LLC and has been licensed for use by State Street Global Advisors, ASL. MSCI indices, the property of MSCI, Inc. ("MSCI"), and ASX®, a registered trademark of ASX Operations Pty Limited, have been licensed for use by State Street Global Advisors, ASL. SPDR products are not sponsored, endorsed, sold or promoted by any of these entities and none of these entities bear any liability with respect to the ETFs or make any representation, warranty or condition regarding the advisability of buying, selling or holding units in the ETFs issued by State Street Global Advisors, ASL. State Street Global Advisors Trust Company (ARBN 619 273 817) is the trustee of, and the issuer of interests in, the SPDR® S&P 500® ETF Trust, an ETF registered with the United States Securities and Exchange Commission under the Investment Company Act of 1940 and principally listed and traded on NYSE Arca, Inc. under the symbol "SPY". State Street Global Advisors, ASL is the AQUA Product Issuer for the CHESS Depositary Interests (or "CDIs") which have been created over units in SPY and are quoted on the AQUA market of the ASX. The whole or any part of this work may not be reproduced, copied or transmitted or any of its contents disclosed to third parties without State Street Global Advisors, ASL's express written consent.