ETF industry hits all-time high
The Australian exchange traded fund industry reached $21.9 billion in total funds under management (FUM) in April, establishing a new record, according to the BetaShares Australian Exchange Traded Funds (ETFs) Review.
The total FUM, which increased by $516 million or 2.4% month-on-month, was fuelled largely by new money ($274 million) and by a growth in asset value.
While broad Australian equities and fixed income products received the highest level of inflows, short exposures also saw the significant inflows driven by investors looking to hedge their US and Australian equities investments.
The only outflows in April were in unhedged gold exposures, with Australian investors seeking to take profit following the rally in gold prices earlier this year. Additionally, the commodities-related exposures, in particular gold-miners, silver and crude oil, also recorded a strong performance.
BetaShares managing director, Alex Vynokur, said the investors were "still cautious" and wanted to "protect their portfolios from risk of declines using exchange traded products such as the Bear Funds".
"While diversification remains the primary reason investors use ETFs, the growth trajectory of the ETF market in Australia tells us that ETFs are being used to cover a full suite of assets classes and strategy exposures,"
"We expect the ETF industry to continue to evolve in the coming months, providing investors even more ways to harness ETFs to suit their investment goals," he said.
AUTHOR
Oksana Patron
Recommended for you
Natixis Investment Managers has hired a distribution director to specifically focus on the firm’s work with research firms and consultants.
The use of total portfolio approaches by asset allocators is putting pressure on fund managers with outperformance being “no longer sufficient” when it comes to fund development.
With evergreen funds being used by financial advisers for their liquidity benefits, Harbourvest is forecasting they are set to grow by around 20 per cent a year to surpass US$1 trillion by 2029.
Total monthly ETF inflows declined by 28 per cent from highs in November with Vanguard’s $21bn Australian Shares ETF faring worst in outflows.
