At the end of June, global assets in exchange traded funds surpassed $10.5 trillion for the first time.
According to data provided to Financial News by consultancy ETFGI, the worldwide ETF industry handled $10.51 trillion at the end of June, up from $10.32 trillion at the end of May, the previous all-time high.
According to ETFGI, global assets have gained 13.5% so far this year, jumping from $9.26tn at the end of 2022.
In June, the global ETF sector received $103 billion in new money, marking the 49th consecutive month of inflows. Globally, ETFs have raised $376.2 billion since January.
“We are seeing an increase in the use of ETFs all over the world.” “They are used by large institutional investors, financial advisers, and retail investors,” ETFGI managing partner Deborah Fuhr told FN.
“In the United States, we have also seen large firms that previously stated they would never offer ETFs begin to embrace them and offer them to investors as a wrapper.” ETFs are being used for more than just index exposure; they are also being used for active [exposure].”
JPMorgan Asset Management, Fidelity Investments, and American Century are among the major US asset managers that have launched active ETFs.
Others have converted classic active mutual funds into exchange-traded funds (ETFs). Between 2021 and 2022, Dimensional Fund Advisors converted seven mutual funds with total assets of more than $44 billion to ETFs.
Dimensional submitted an application with the Securities and Exchange Commission on July 13 to establish ETF share classes for its current mutual funds.
Vanguard, a US asset management firm, was the first to offer ETF share classes of existing mutual funds, patenting the technique in 2001. However, the patent expired in May, allowing other asset managers to replicate it.
According to ETFGI, ETF providers in the US and Europe have continued to witness robust demand for their products, with US ETFs generating $228 billion in net inflows over the first six months of the year.
Meanwhile, ETFs in Europe have accumulated $72 billion since January.
Fuhr went on to say that the ETF story was “percolating around the world” and that it was becoming a popular product for investors wishing to invest outside of their local market.
“It is an increasingly global phenomenon that is being used by different constituents of investors, and it will continue,” Fuhr said.
Please note that this article does not offer any instructions or suggestions regarding investment decisions. It is important for you to conduct your own research or seek professional advice from a qualified professional before conducting an investment decision.