The Australian exchange traded fund (ETF) industry fell by $1.7 billion in February and ended the month at $130.1 billion, due to a combination of falling global sharemarkets and anaemic flows.
According to the BetaShares Australian ETF Review, the industry was currently down by around $7 billion from the highs recorded in December 2021, however with the Australian sharemarket recovering, the industry fall was significantly less than January (-$5.2 billion).
The report also confirmed that Australian ETF investors were cautious this month given geopolitical conflict, inflation fears and volatile markets which resulted in net flows of only $212 million for the month, the lowest level of net flows in five years.
However, the market volatility did not stop product development activity, with five new products launched this month, with the best performance in February coming from gold mining and oil exposures.
“For the first time in the industry’s history, we saw the international equities category in net outflow (-$300m) – this was driven in large part by significant flows out of the Magellan Global Fund (~$700m outflow),” the report said.
“Net inflows were recorded in Australian equities products (~$318m) which outperformed global equities significantly in February. Notably we also saw net inflows in ethical global equities products which remain a very fast growing category in the Australian ETF landscape.”
