The pace of growth was, however, slower compared with previous months, with market capitalisation growing 1.2 per cent and units outstanding increasing 1.6 per cent, bringing a total net of $50 million into the industry.
This month saw a strong US theme with US equities and US dollar currency exposures recording high levels of net inflows.
“ETF inflows suggest investor appetite has not dampened for US exposures despite concerns around the US debt ceiling, with investors adding both US equities and the US dollar currency to their portfolios,” said Alex Vynokur, managing director of BetaShares.
Despite the optimistic sentiment towards international equities, investors continue to seek out cash. The Australian high-interest cash ETF was in the second highest category for net inflows, while the BEAR fund, which is designed to go up when the market goes down, entered the top 10 funds by net inflows for the first time since 2013.
Mr Vynokur said the exchange-traded product flows for September show that some investors are still reluctant to take on risk assets.
“While on the one hand money is still flowing into international equities, there is also another part of the market that is looking for the capital stability of cash or even taking a view that the market is potentially due for a correction and using the BEAR fund to hedge portfolios or to profit from a market decline,” said Mr Vynokur.
Global equities and Asian country ETFs had the best performance this month. Mr Vynokur said this wasn’t surprising given the poor performance of emerging markets in August, as investors shifted back to developed economies such as the United States.
He said as the industry continued to mature, ETF flow information will become increasingly relevant as an indicator for investment sentiment.
