and year-to-date in the first 10 months of the year gathered net inflows of US$150.9 Bn. At the end of October 2014 the US ETF industry had 1,651 ETFs/ETPs, assets of US$1.92 Tn, from 69 providers listed on 3 exchanges, according to preliminary data from ETFGI’s end October 2014 Global ETF and ETP industry insights report.
Year-to-date net new asset (NNA) flows reached record levels for the ETF/ETP industries in Japan with US$15.7 Bn, Europe with US$56.2 Bn, and globally with US$233.4 Bn. Assets invested in the US-listed ETF/ETP industry hit a new record high of US$ 1.92 Tn.
“October was a challenging month with increasing macroeconomic concerns over deflation fears in Europe, the ECB’s stimulus program, Germany cutting GDP forecasts due to “geopolitical crisis”, dismal employment figures in France, 25 of around 130 European banks having reported to have failed the ECB’s “stress test”, and questions over the U.K.’s continued membership in the European Common Market. At the end of the month markets reacted positively to the Bank of Japan’s announcement of new annual purchasing targets of ¥80 Tn in bonds and ¥3 Tn in ETFs. The S&P 500 reached a new record, 2,018, which is up 1.2% for the month and 9.2% for the year. Developed markets ended the month down 2% while emerging markets gained 2%.” according to Deborah Fuhr, Managing Partner at ETFGI.
In October 2014 ETFs/ETPs saw net inflows of US$26.1 Bn. US-listed ETFs/ETPs registered a record level of monthly NNA into fixed income products, gathering US$16.3 Bn, surpassing the prior record of US$13.6 Bn set in February 2014. Equity ETFs/ETPs gathered US$9.8 Bn, while commodity ETFs/ETPs saw net outflows of US$680 Mn.
iShares gathered the largest net ETF/ETP inflows in October with US$18.0 Bn, followed by Vanguard with US$7.5 Bn and Schwab ETFs with US$1.2 Bn net inflows. Year-to-date iShares gathered the largest net ETF/ETP inflows with US$59.2 Bn, followed by Vanguard with US$55.0 Bn and First Trust with US$8.7 Bn net inflows.
iShares is the largest ETF/ETP provider in terms of assets with US$738 Bn, reflecting 38.5% market share; SPDR ETFs is second with US$414 Bn and 21.6% market share, followed by Vanguard with US$408 Bn and 21.3% market share. The top three ETF/ETP providers, out of 69, account for 81.4% of US ETF/ETP assets, while the remaining 66 providers each have less than 5% market share.
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Note to editors
ETFs are typically open-ended, index-based funds, with active ETFs accounting for less than 1% market share. They can be bought and sold like ordinary shares on a stock exchange and offer broad exposure across developed, emerging and frontier markets, equities, fixed income and commodities. ETFs are used widely by institutional investors and increasingly by financial advisors and retail investors to:
- equitize cash
- implement diversified exposure to a market
- comprise a core or satellite investment
- be a long term strategic investment
- implement tactical adjustments to portfolios
- use as building blocks to create entire portfolios
- allow investors to hedge the market
- use as an alternative to futures and other derivative products
Exchange Traded Products (ETPs) are products that have similarities to ETFs in the way they trade and settle but do not use an open-end fund structure. The use of other structures including unsecured debt, grantor trusts, partnerships, and commodity pools by ETPs can, in addition to a significantly different risk profile, create different tax and regulatory implications for investors when compared to ETFs, which are funds.
Established by industry expert Deborah Fuhr and partners, ETFGI is a wholly independent research and consultancy firm providing research and services to firms such as leading global institutional and professional investors, the global exchange traded fund and exchange traded product industry, its Regulators and its advisers. The partners leverage over 30 years of extensive industry experience, unparalleled industry contacts and rigorous analysis to deliver proprietary research on the global ETF and ETP industry.
ETFGI has recently published a report called “Institutional Users of ETFs and ETPs 2013” which examines and profiles the number and types of ETFs and ETPs being used by institutional investors globally from 2006 through 2013.