Australian ETF market FUM reach $40.41bn in 2018
Australians have over $40 billion of their savings invested in exchange traded funds (ETFs) according to the latest figures by the Australian Securities Exchange (ASX), with 49 per cent of 2018 ETF cash flows being allocated to international equities.
Last year also saw inflows grow by $4.7 billion, which was 13.2 per cent up compared to 2017, despite a slight drop in total ETF FUM in the fourth quarter of 2018.
However, industry wide cash flow for 2018 declined to $6.44 billion from $8.08 billion a year before, with ETF assets growing at a compound annual growth rate of 32 per cent over the past five years.
Vanguard’s head of ETF Capital Markets, Damien Sherman, said that investors continued to seek mostly ETF products that would provide them with an exposure to international equities.
“Despite the challenging investment conditions in 2018 investors continue to embrace the benefits of ETFs, spurring growth in the market, increased competition among issuers and rising trading volumes that have in turn driven down the cost to invest, allowing investors to keep more of the returns they earn,” he noted.
Vanguard said it was a strong year for its range of Diversified ETF’s that broke new ground in the Australian ETF market, with four of its Diversified ETFs (Conservative, Balanced, Growth and High Growth) ending 2018 with $277 million in combined assets under management.
AUTHOR
Oksana Patron
Recommended for you
Sydney-based alternative fund manager East Coast Capital Management has formed its first advisory council as it enters its next phase of growth.
With 40 per cent of advice practices looking to increase their ETF usage, the next frontier being embraced is smart beta ETFs with flows doubling in July, providers have said.
Australian ETFs saw flows of $5.8 billion in July, more than double the previous month, and adviser adoption is tipped to help total flows reach $50 billion by the end of the year.
Pinnacle’s London affiliate, Life Cycle Investment Partners, has secured over $15 billion in FUM in its first year and achieved profitability, the firm’s fastest affiliate to do so.
