Australia’s ETF industry FUM approaches $50bn

Australia’s exchange traded fund (ETF) industry saw funds under management approach close to $50 billion in May, fuelled by net inflows, according to the latest monthly BetaShares Australian ETF Review.

The study found the industry received close to $1 billion in net new money during the month which saw the industry reach a new all-time record in terms of trading value, with more than $4 billion of value traded over the month for the first time.

As far as the asset classes were concerned, investors favoured Australian equities and fixed income, with both categories having received around $250 million of net flows, and were followed by international equities which received over $211 million in inflows.

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At the same time, escalating US/China trade war tensions caused US equities to fall, and as a result, slow the rise of the Australian ETF industry while gold exposures also saw net outflows of $25 million as investors took profits following strong performance in previous months.

“Fixed income ETFs have received significantly more attention this year than ever before as investors continue to exhibit caution on the equities market. Year to date, fixed income is the number one category for flows in the industry, marginally beating out the ever-popular international equities category,” BetaShares’ chief executive, Alex Vynokur, said.

“Investors are increasingly realising the benefits of ETFs in obtaining targeted exposure to this asset class, with the breadth of the fixed income ETF products range now allowing investors to build bond portfolios which are tailored to their specific needs.”

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