ETP inflows on track for record year

ETP inflows on track for record year

Global exchange-traded product inflows for August were $38.9 billion, bringing the year-to-date flows to $213.4 billion – marking a higher pace of growth than in the record-setting 2015, according to BlackRock.

The BlackRock Global ETP Landscape report for August showed a third month of inflows for emerging market equity exchange-traded products (ETP), gathering an additional $6.2 billion for August.

This is on target to set a new yearly inflow record for the emerging market equity category, BlackRock noted, with year-to-date inflows sitting at $22.9 billion.

Likewise, emerging market debt ETPs have broken the 2012 inflow record of $8.3 billion after August’s additional $1.9 billion brought year-to-date inflows for the category to $12.7 billion.

These trends sat in stark contrast with European ETPs, which saw outflows during the month.

“Pan-European equities shed $2.7 billion and German equities shed $1.1 billion as earnings continued to deteriorate and inflation remains stubbornly low,” BlackRock explained.

In the US, preferred stock funds experienced a record month, receiving $1.1 billion inflows, marking a year-to-date gain of $5.2 billion, BlackRock said.

Fixed income ETPs were also experiencing strong inflows throughout 2016, BlackRock added.

“2016 year-to-date flows for fixed income through August grew to $95.1bn and have already surpassed the full-year 2015 total of $86.8,” the company said.

“Investment grade corporate debt funds are a significant contributor. A number of factors have aided flows to the category.”

These factors include the US Federal Reserve continuing to “signal a rate rise on the horizon”, the above record-pace of Europe-listed investment grade corporate bond flows and investors seeking high-quality yield “in light of low and negative yields globally”.

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