A Visual Guide To The ETF Universe

Published on by on April 23, 2013 | Updated February 25, 2014

With over 1,400 products and counting, the ETF universe has certainly come a long way since SPY made its debut as the first exchange-traded fund in 1993. And as the industry continues to democratize the investment landscape, exchange-traded products are becoming more widely used by all types of investors, from individuals with relatively small accounts to sophisticated hedge funds managing billions of dollars.

Considering the sheer magnitude of the ETF space, picturing the size and scope of the industry may seem like a daunting task. Here we take a visual approach to slicing and dicing the ETF universe.

As always, we encourage you to use our suite of free tools at ETFdb.com, including the ETFdb CategoriesETF Screener and the ETF Analyzer for all your ETF research needs.

ETFs By Asset Class

Asset Class Product Count Largest ETF
Equity 879 SPY
Bond 215 LQD
Commodity 151 GLD
Alternatives 54 VXX
Currency 37 UUP
Real Estate 35 VNQ
Multi-Asset 35 MDIV
Preferred Stock 8 PFF

Even a quick glance at the ETF product lineup shows the dominance of equity-based funds. Together, they account for over 80% of the ETF industry’s total assets and more than two-thirds of the total product count.

The prolific S&P 500 ETF (SPY, A) is by far the largest equity ETP, as well as the largest fund in the ETF universe. To put things in perspective, SPY’s total assets under management account for over one-tenth of all equity-based funds’ assets combined.

Fixed income exchange-traded funds are the second largest group by product count, followed by commodity-based ETPs. But while there are a greater number of individual bond ETFs, commodity funds rake in significantly more assets. Another surprising statistic is that while there are only about 35 real estate ETFs, together they maintain more assets under management than bond and alternative funds combined.

Exchange-Traded Product Structures

Structure Largest ETP
ETF VWO
ETN AMJ
Commodity Pool DBC
Grantor Trust GLD
UIT SPY

While many use the term “ETF” rather liberally to refer to a variety of different exchange-traded products, ETFs themselves do in fact account for the vast majority of ETPs. ETNs however, which are debt instruments, have steadily gained ground over the years, with the largest exchange-traded note by assets being the ultra popular Alerian MLP Index ETN (AMJ, B).

Some investors may be surprised to find that the two largest exchange-traded products aren’t ETFs at all; SPY is a Unit Investment Trust, and GLD is a Grantor Trust

Active vs. Passive ManagementETF Universe

More than 95% of all exchange-traded products are “passive,” meaning they are designed to replicate the benchmark of an index. Actively-managed ETFs have gathered momentum over the years; there are now about 50 active exchange-traded products, which, combined, manage over $12.6 billion in assets [see Actively-Managed ETF Portfolio].

The majority of actively-managed ETPs are bond funds, with PIMCO’s Total Return ETF (BOND, B) (managed by legendary bond king Bill Gross) raking in over $4.5 billion in total assets – that amounts to more than a third of all active ETP’s assets combined.

And while there are several equity, alternatives and currency funds that are actively-managed, there are not too many options for the remaining asset classes – a sign that active ETPs are till just scratching the surface of their potential.

Leveraged and Inverse ETPs

Leverage/Inverse Largest ETP
2X SSO
3X FAS
-X SH
-2X TBT
-3X TZA

In total, there are about 250 leveraged and/or inverse exchange-traded funds, which, combined, manage over $31 billion in assets. The largest fund is ProShares’ UltraShort Barclays 20+ Year Treasury Fund (TBT, A), a popular and powerful tool for active traders.

Of all the combinations of leveraged and inverse exposure, the vast majority are 2x and -2x. Products that offer 3 times the exposure of a given index, however, account for nearly a third of all leveraged and/or inverse ETPs.

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