ETF sector hits $21.8bn in April

ETF sector hits $21.8bn in April

After retreating slightly in early 2016, the Australian ETF sector hit a record high at the end of April, reaching $21.8 billion, according to the ASX.


The ASX Monthly Funds Report for April 2016 found there are now 130 ETFs in the Australian market, with a total market capitalisation of $21.8 billion.

BlackRock's iShares, Vanguard and State Street continue to dominate the market with $7 billion, $5.2 billion and and $4.6 billion slices of the market, respectively.

BetaShares comes in fourth with $2.6 billion in funds under management (FUM) and 23 products on the market.

In its own Australian ETF review for April, BetaShares pointed out that total FUM in the market increased by $516 million (2.4 per cent) on the March 2016 numbers – with half of the amount coming from new money.

"Reflective of the recovery in the local equity market and the changes to interest rates, broad Australian equities and fixed income products received the highest level of inflows," said BetaShares.

BetaShares managing director Alex Vynokur said volatility is still a concern for investors, with many choosing to protect their portfolios with the BetaShares Bear Funds.

"Strong performance was also recorded in commodities-related exposures this month, and in particular gold miners, silver and crude oil," he said.

“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 asset classes and strategy exposures," Mr Vynokur said.

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