Thematic ETFs see 70% FUM growth
Assets in thematic exchange traded funds (ETFs) could reach $10 billion by the end of 2021, according to VanEck.
Over the six months to 30 April, 2021, funds under management in thematic ETFs grew by 70% to $4.3 billion. In contrast, the Australian Securities Exchange (ASX) listed market capitalisation ETFs grew by 33.4% to $66.1 billion.
VanEck chief executive, Arian Neiron, said the appeal of thematic ETFs was they were accessible, liquid and low cost and allowed investors to position their portfolio to actively take advantage of certain trends.
These included robotics, video games, clean energy and global healthcare.
“This is the next chapter for the ETF market, the growth of thematic ETFs which is underpinned by sustainable long-term trends in which momentum is building. These offer investment strategies that capitalise on enduring economic trends or themes, with technology, clean energy and healthcare favoured among investors,” Neiron said.
“VanEck’s Video Gaming and eSports ETF (ASX: ESPO), for example, has been our quickest-growing ETF since we first launched our funds in Australia in 2014. ESPO is Australia’s first and only dedicated video gaming and esports ETF and has drawn FUM of around $100 million in just seven months.
“Another sector where we are seeing significant investment opportunities is global healthcare. Even before COVID-19, health spending was rising strongly across nations given ageing demographics and emerging nations’ healthcare systems catching up to developed nations. Investors are likely to reap the benefits of the healthcare expansion and rising investment.”
AUTHOR
Laura Dew
Recommended for you
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.
For foreign fund managers looking to come to Australia, a financial services law firm has shared which regulatory option offers them the quickest pathway?
Betashares has partnered with a US fund manager to form a private capital division aimed at providing financial advisers and wholesale clients with private markets investments.
