September ETF Data: Summer Rally Continues

by on October 6, 2009 | ETFs Mentioned:

The September numbers are in, and the ETF industry’s winning streak is alive and well. Total assets under management increased from approximately $672 billion in August to $705 billion in September, aided by strong performances from equity markets but also by more than $9 billion of inflows into ETFs as investors embrace the benefits of the exchange-traded structure. Inflows ETFs seeing cash inflows outnumbered those experiencing outflows by more than 2-to-1, with 413 ETFs/ETNs growing and only 171 had contracting for the month.

ETF Issuers

iShares ($3.8 billion) and Vanguard ($2.7 billion) saw the biggest inflows for the month, but the wealth was certainly spread around the ETF industry. ProShares and Direxion, leaders in the leveraged ETF space, saw inflows of about $820 million and $405 million, respectively, a clear sign that leveraged funds remain popular among investors despite the storm of controversy that has surrounded these companies this year.

Several smaller issuers saw big percentage gains in September. WisdomTree’s inflows for the month equaled almost 7% of the previous month’s assets, while RevenueShares monthly inflows were nearly 11% of August’s total assets.

Three ETF issuers saw assets more than double between August and September, thanks largely to the addition of new funds. ETF Securities, which launched its Physical Swiss Gold Shares (SGOL) in September, saw assets jump 110%, while Pimco and ALPS saw gains of 138% and 143%, respectively.

Individual ETFs

After outflows of nearly $1.6 billion in August, ProShares ETFs saw inflows of more than $800 million in September, the third most of any ETF issuer. More than half of ProShares’ monthly inflows were into the UltraShort Lehman 20+ Year Fund (TBT), perhaps as investors searched out ETF plays that may benefit in a hyperinflationary environment. Another popular inflation hedge, the SPDR Gold Trust (GLD) also enjoyed a stellar September, with inflows of over $2 billion. SGOL, which began trading in early September, ended the month with an even $100 million in assets, a remarkable accomplishment for a new ETF.

Emerging markets ETFs were also popular in September, particularly the Vanguard MSCI Emerging Markets ETF (VWO) and iShares MSCI Emerging Markets Index Fund (EEM). VWO and EEM saw monthly inflows of $770 million and $651 million, respectively, last month.

Asset Classes

Fixed income ETFs continue to enjoy a meteoric rise in popularity among investors. With monthly inflows of more than $4 billion in September, this asset class saw its quarterly total rise above $10 billion. Still, the size of fixed income ETFs pales in comparison to equity funds, a sign that this area will continue to expand rapidly going forward.

Cash actually flowed out of domestic equity ETFs in September and into international funds, perhaps as investors continued to regain their appetite for risk and sought out emerging market exposure. Finally, despite a challenging regulatory environment, commodity ETFs were in strong demand in September, generating more than $2 billion in cash inflows despite the fact that the United States Natural Gas Fund (UNG) didn’t issue any additional shares.

Disclosure: No positions at time of writing.