Vanguard sees strong ETF adoption
Vanguard has seen a continued strong adoption of its exchange traded funds (ETFs) in Australia in the fourth quarter of 2017, which represented over a third of Australian ETF cash flows invested in its products over the year, the company said.
Out of total of $8.14 billion of Australian cash flow invested in ETFs, $2.9 billion were invested into Vanguard ETFs which as a result brought total Vanguard ETF funds under management to over $10 billion.
The international equities attracted 42 per cent of the total industry ETF cash flows while Australian equities gained 33 per cent of the those flows.
Vanguard’s head of ETF Capital Markets, Damien Sherman said: “The growth in Australian ETF cash flow follows a worldwide trend of funds flowing into lower cost investment solutions.”
“The ETF industry in Australia has now grown to more than $35 billion with more investors attracted to the low-cost diversification of ETFs than ever before.”
The firm also stressed that 2017 was a good year for ETF investors as all major markets were posting strong returns, with the S&P/ASX300 returning approximately 12 per cent.
According to Vanguard, investors improved their understanding of ETFs and how to utilise them to better diversify portfolios, particularly through the use of international equity products.
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