At the end of October, the global ETF industry reached US$2.3 trillion in assets under management (AUM) with domestic ETFs reaching AU$9.4 billion.
“High yield investing has been a favourite for Australian investors for quite some time and we are now seeing a rapid increase in interest from global investors, with AUM to high yield equity ETFs surpassing $100 billion this month,” SSgA head of SPDR ETFs Australia Amanda Skelly said.
“Year-to-date growth in the Australian ETF market has surpassed 40 per cent, fuelled by financial adviser and continued SMSF investor adoption and their preference for on-exchange access to market opportunities.”
The Australian market saw a slowdown in the growth of ASX-listed ETFS over September, but bounced back over the October month with near-record flows of more than $270 million.
However, SSgA notes that despite the local market delivering some the strongest returns for those months, Australian investors still preferred domestic strategies focused on high yield despite their underperformance.
In addition, investors also looked to diversify their international exposure over the month of October.
“While cash flows to the US market remained strong, we saw a pick-up in interest in other markets such as Europe, and continued flows to those ETFs seeking broad exposure to international markets,” SSgA said.
