After enjoying a record year in 2010, many in the ETF industry were disappointed when January figures revealed a material decline in total assets, breaking an impressive string of month-over-month expansion. The latest ETF statistics from the National Stock Exchange are out, and February results were more typical of the industry’s recent growth. Total ETF assets increased from about $745 billion to $765 billion, while monthly cash inflows totaled $5.4 billion. [click to continue…]
As the ETF industry has continued its rapid expansion, there has been much debate surrounding the sustainability of the current growth and the potential saturation of the market. The first ETFs were relatively simple products, offering exposure to the world’s most widely-followed equity benchmarks. But the last ten years have seen hundreds of new ETFs hit the market that go far beyond “plain vanilla.” Leveraged ETFs, intelligent indexing, exchange-traded commodities, and actively-managed funds are just a few of the innovations the industry has seen.
Some believe that the ETF industry has gone into “absolute overdrive.” Others think that any reports of an ETF issuance bubble have been greatly exaggerated. While there are some valid points made on both sides, it is perhaps best to let the numbers decide. According to the latest data from the National Stock Exchange, more than 120 exchange-traded products have been launched this year, covering a wide variety of asset classes, geographies, and investment styles. These funds have seen aggregate cash inflows this year of more than $7.3 billion and have total assets of more than $7.7 billion. Several of these funds have not received the welcome that their issuers had expected, achieving less than $10 million in aggregate assets. But others have been tremendously popular, raking in hundreds of millions of dollars as investors embraced both innovative funds and those that offer a slight tweak to existing products.
The ten most successful ETFs of 2009, as judged by total cash inflows for the year, include:
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Leveraged ETFs have been in the news a great deal lately, although the majority of the coverage has been less than flattering. Over the last week, several prominent financial institutions have ceased purchasing leveraged ETFs on behalf of their clients, citing the incompatibility of the short-term nature of these products with their long-term views on [...]
The old saying “any publicity is good publicity” certainly seems to ring true in the ETF industry. Over the last several months, leveraged ETFs have been the subject of intense scrutiny, first from individual investors and analysts, and more recently from regulatory agencies such as FINRA. Despite allegations that these funds are dishonest products that [...]
Leveraged ETFs have quickly become the hot-button issue in the ETF industry, dividing investors and observers into two distinct camps. On the one side are sophisticated day traders who believe these funds, which use derivatives and other complex financial instruments to provide amplified daily returns on a target index, are the greatest thing since sliced bread. And on [...]
After growing at a torrid pace in 2008, the ETF industry had showed signs of slowing down through the first four months of 2009. But May represented a return to old form, with more than $14 billion in new assets flowing into ETFs during the month according to Morningstar, the largest monthly inflow of the [...]
