A busy first week of September was overshadowed by large redemptions. Although our creation/redemption ratio was even, our notional redemptions far exceeded our creations and hence we had net outflows of more than €75m for the first time in six months.

Although we saw substantial creations in property sector funds such as the EasyETF FTSE EPRA Europe (NYSE Euronext: EEP) and iShares FTSE EPRA/NAREIT Developed Markets Property Yield Fund (LSE: IDWP), ETFs tracking dividends – such as the iShares FTSE UK Dividend Plus (LSE: IUKD), iShares DJ Euro STOXX Select Dividend (LSE: IDVY), iShares Dow Jones Asia Pacific (LSE: APSDEX) and iShares DJ Euro Stoxx Select Dividend ETF (LSE: SD3EEX) – were sold to market makers in large quantities following a 21-25% gain over the last two months, the best performance these ETFs have enjoyed in three years.

ETFs tracking China saw large redemptions with investors still selling the region on concerns surrounding a quick recovery. For many investors, China remains an important benchmark in their portfolios.

ETFs tracking natural gas saw record volumes last week with 64.5 million shares traded on the LSE. Expectations of high stockpiles put gas under price pressure not seen since March 2002. The ETFS Sugar ETC (LSE: SUGA) lost 11% last week following a three-month rally of 33%. Gold and palladium ETCs were up 11% and are flirting with their record highs this year, although silver remained unchanged.

There was some interest last week in the iShares FTSE UK Gilt All Stock (LSE: IGLT) and iShares Euro Government Bond 1-3 ETF (LSE: IBGS). Meanwhile, demand for ETFs tracking MSCI Europe – such as the StreetTRACKS MSCI Europe (NYSE Euronext: ERO), iShares MSCI Europe (LSE: IMEU) and iShares MSCI Europe Ex UK ETF (LSE: IEUX) – was still strong, although there remains a tendency to buy more Euro or continental European ETFs than UK ones.

This report is not an offer to sell or a solicitation of any investment products or other financial product or service, an official confirmation of any transaction, or an official statement of LSPE.