A growing number of Australian investors are turning to exchange-traded funds (ETFs) and making them a core component of their portfolios, says BlackRock’s ETF business iShares.
As the Australian ETF industry was bolstered to $15 billion in onshore assets by the end of 2014, iShares head of Australia Jonathan Howie said investors are seeing the value of ETFs in their portfolios.
“Australian investors are rapidly incorporating ETFs into the core of their portfolios,” Mr Howie said.
“They’re utilising ETFs for the same reasons as investors globally – simple, low-cost access to the world's markets,” he said.
Global head of iShares, Mark Wiedman, said it is also seeing ETFs “truly come of age” as more investors incorporate them into their portfolios.
“More investors around the world recognise and embrace the versatility of these vehicles – whether it’s for their strategic buy-and-hold investments or precision exposures to express a view on virtually any market,” Mr Wiedman said.
“ETFs have also been discovered by capital market participants, who are using them as efficient substitutes for futures and swaps.”
The ETF provider also pointed out that it experienced strong growth during 2014 as iShares captured 31 per cent of the $330.7 billion global ETF market flows.
“Growth was driven by the iShares US and European product lines, which continue to be adopted by investors across the globe,” a statement from iShares said.
“The iShares US product line led the way with a record $82.8 billion of new assets in 2014, surpassing the previous record for US iShares ETFs of $62 billion in 2012.
“In Europe, the business captured $20.3 billion in net new flows,” the statement said.