Eighteen months after first entering the Australian market, Global X has declared its intention to chase down local competitors in a bid to reach $10 billion in assets under management (AUM) by the end of 2025.
After being acquired by Global X – a subsidiary of Mirae Asset – in June 2022, ETF Securities Australia rebranded to Global X ETFs later in the year.
Since setting up shop under the new banner in September 2022, the ETF provider’s AUM has surpassed $6 billion, with future plans to continue expanding its market share.
Global X Australia chief executive officer Evan Metcalf said the firm is well on its way to achieving its goal, having worked on developing its brand, team, and product lineup over 2023.
“Heading into the new year, we are elevating our strategic approach to drive meaningful growth across the business and increase our share in the Australian ETF market which is currently sitting at 4 per cent,” Mr Metcalf noted.
“Our current lineup is comprised of many unique and innovative solutions, many first to market. Next year, we have plans to continue the expansion of our product range so, over time, it will be relevant to more clients.”
While acknowledging that the company has no intention to pursue a “price war”, the CEO said that Global X is committed to competing aggressively on price where necessary.
“We will continue to focus on products that we know have upfront demand and are true to our investor-first philosophy.”
The 12 funds that Global X has launched since entering the market includes Australia’s only copper miners ETF, a suite of covered call products, and what the company deems to be a competitor to one of the most popular tech-heavy index ETFs in the US.
Noting that the Australian ETF market is becoming increasingly sophisticated and saturated, senior product and investment strategist David Tuckwell said the firm intends to defend its leadership in niche segments while diversifying into new areas.
“Producing year to date total returns of more than 55 per cent and 86 per cent, respectively, the Global X Semiconductor ETF (ASX: SEMI) and Global X FANG+ ETF (ASX: FANG) – the only funds of their kind in Australia – have been two of the top-performing ETFs in 2023,” Mr Tuckwell explained,
Global X’s direct exposure cryptocurrency ETFs, he added, have similarly outperformed. According to the firm, the US Securities and Exchange Commission’s delayed decision to approve spot Bitcoin ETFs will also egg on bitcoin and Ethereum prices.
Looking ahead, Mr Tuckwell projects that the Australian market will enter a period of structurally higher gold prices, with 2024 set to be a “record setter for gold prices”.
“Alongside gold, US treasuries will also be in vogue next year thanks to real yields sitting in their highest 90th percentile over the past 20 years at many points in the curve.
“In my opinion, get them while they’re hot,” he concluded.
On the other side of the world, Global X also reaffirmed its focus on India as a compelling growth opportunity, with notable growth this year to date attributable to strong economic, demographic, and political drivers.
Namely, with India’s third quarter GDP jumping to 7.6 per cent – well over the 6.5 per cent projected by Reserve Bank of India and international analysts – the firm has assured that India’s outperformance will be able to be captured in the Global X India Nifty 50 ETF.
When asked whether the firm has any plans to expand into other areas in the future, as has been seen by competitor Betashares in recent months, Mr Metcalf highlighted a $28 million investment in robo-adviser Stockspot by Global X’s parent firm Mirae Asset earlier this year.
“I think the focus for us is very much around maintaining those two businesses, separate entities. But we do see as an overall group, some synergies … providing access points to product, providing product and being able to just tap into clients that way and give them a full range of services,” he told InvestorDaily.
“There’s nothing that I can kind of talk to at the moment in terms of anything concrete, but I think that’s definitely an area where we’re watching closely and looking at opportunities more broadly.”