The Australian ETF industry suffered a notable decline in value last month with overall assets under management down $5.6 billion or 4.3 per cent from the previous month to $124.4 billion.
According to the BetaShares Australian ETF Review for September, industry flows remained positive at $0.8 billion, but this was not enough to combat the declines seen in sharemarkets.
“With continued asset value depreciation, industry growth over the last 12 months is now flat, recording a small decline year on year of 0.7 per cent or -$0.9 billion,” said BetaShares chief commercial officer, Ilan Israelstam.
The firm reported that the month’s best performing ETFs, given the significant falls in global sharemarkets, were all leveraged short products.
This included the ETFS Ultra Short Nasdaq 100 Hedge Fund (SNAS) with a return of 28.3 per cent along with the BetaShares US Equities Strong Bear Currency Hedged (Hedge Fund) (BBUS) and the BetaShares Australian Strong Bear (Hedge Fund) (BBOZ), which returned 23.6 per cent and 15.5 per cent, respectively.
The BetaShares Strong US Dollar Fund (Hedge Fund), with a return of 15.4 per cent, and ETFS Physical Palladium (ETPMPD), with a 13.4 per cent return, also performed strongly.
“Category flows were markedly different this month compared to the trend in the year to date, with fixed income & cash ETFs receiving the lion’s share of industry flows — with over 50 per cent of the industry’s monthly net inflows between them,” said Mr Israelstam.
“With investors remaining cautious on equities and yields continuing to rise, it has been high-interest cash and floating-rate Australian bond exposures that have seen the highest level of investor interest in September.”
By inflow value, fixed income ($322.4 million), cash ($292.1 million), Australian equities ($114.2 million), multi-asset ($62.2 million) and listed property ($49.6 million) were the top categories.
Meanwhile, the top categories by outflows were short ($28.7 million), commodities ($26.8 million) and international equities ($735,000).
A total of 304 exchange-traded products were trading on the ASX during September, with BetaShares’ own Global Royalties ETF the only new product to be launched.
Based on year-to-date ETF issuer flows, the firm is the second largest provider at $2.78 billion, behind Vanguard ($6.3 billion) and ahead of VanEck ($1.5 billion). Combined, the three providers have accounted for almost 80 per cent of all ETF industry flows in 2022.
