Foreign ETFs: How Other Countries Stack Up

Published on by on April 2, 2014

The first exchange-traded fund made its Wall Street debut in 1993, and more than two decades later, investors now have more than 1,500 products to choose from. Outside of U.S. markets, several countries have also embraced ETPs. Currently, there are more than 5,000 exchange-traded products across the globe, from over 200 providers on 59 exchanges. Below, we take a look an in-depth look at the ETF industry outside the U.S. (all data as of January 2014, courtesy of ETFGI):

 

The chart above depicts the size of the ETF markets across the globe by number of product offerings. Please note that the numbers include both primary and secondary listings. Currently, Germany has the most listed exchange-traded products, with roughly 300 more offerings than the U.S.. In terms of assets, however, the U.S. still dominates (note: total assets represent only primary listings):

Combined, ETF assets across the globe total over $2.9 trillion. European ETFs alone account for under 20%, while ETPs from Asia Pacific account for roughly 7%. To further put into perspective the sheer size and scope of the ETF industry (particularly in the U.S.), here is a look at how assets across regions stack up [see also A World Without ETFs]:

Top ETF Markets Outside the U.S.

Click through the buttons below to get a closer look at the five largest ETF markets outside of the U.S. (please note that ETF AUM data is as of March 25, 2014):

The London Stock Exchange has roughly 1,500 listings of exchange-traded products. In April of 2000, iShares listed the U.K.’s first ETF on the London Stock exchange, tracking the FTSE 100 Index. The majority of ETP users in the U.K. are institutional investors; retail investors hold only 10% of ETP assets, of which only 1% are individual investors. Analysts, however, believe that as average investors become more familiar with ETPs, the U.K. will likely follow the same trajectory as in the U.S., where more and more retail investors begin to embrace ETPs.

Major Players:UK

  • iShares
  • ETF Securities
  • Deutsche Bank
  • UBS
  • Lyxor
  • Amundi

Most Popular Funds

  • iShares S&P 500 UCITS ETF (IDUS), £8.3 billion
  • iShares EURO STOXX 50 UCITS ETF (EUE), £5.2 billion
  • iShares MSCI World UCITS ETF (IWRD), £4.2 billion
  • iShares FTSE 100 ETF (ISF), £4.0 billion

Germany has over 1,800 exchange-traded products listed on Xetra. According to Deutsche Borse Group, Xetra was Europe’s first trading venue and currently holds a market share of 35%, making it the leading ETP trading platform in Europe. Xetra- listed ETFs alone have an average monthly trading volume of around €10 billion.

Major Players:Germany

  • iShares
  • Deutsche Bank
  • Lyxor
  • Amundi
  • UBS
  • ComStage
  • Deka

Most Popular Funds

  • iShares DAX UCITS DE (EXS1), €16.5 billion
  • iShares S&P 500 UCITS ETF (IUSA), €9.8 billion
  • iShares EURO STOXX 50 UCITS ETF (EUN2), €6.2 billion
  • iShares MSCI World UCITS ETF (IQQW), €4.9 billion
  • Lyxor UCITS ETF EURO STOXX 50 (LYSX), €4.9 billion

Though Japan’s Tokyo Stock Exchange only has a little over 172 ETPs listed, the country is currently ranked fourth in terms of total ETP assets. The first exchange-traded product began trading on the TSE in 1995; in 2012, the exchange listed its first leveraged and inverse ETFs. Currently, the daily average volume of the ETF/ETN market is about JPY 136.3 billion.

Major Players:Mount Fuji, Japan

  • Mitsubishi UFJ Trust
  • Daiwa
  • Nomura
  • Nikko
  • iShares
  • Barclays

Most Popular Funds

  • Nikkei 225 ETF (1321), ¥ 1.8 trillion
  • Topix ETF (1306), ¥ 1.5 trillion
  • NIKKO ETIF 225 (1330), ¥ 845 billion
  • Daiwa ETF -TOPIX (1305), ¥ 700 billion
  • Daiwa ETF – Nikkei 225 (1320), ¥778 billion

Canada is currently home to more than 400 exchange-traded products, with total assets under management of more than $56 billion. According to the Toronto Stock Exchange (TSX), the world’s first successful exchange-traded, index-linked product was listed on Toronto Stock Exchange (TSX) in 1990. Since then, the Canadian ETF industry has grown significantly. Currently, exchange-traded products comprise 19% of total TSX listings. 

Major Players:Niagara Falls, Canada

  • iShares
  • Barclays
  • BMO
  • First Asset
  • Horizons
  • PowerShares
  • First Trust
  • Purpose
  • RBC
  • Vanguard

Most Popular Funds

  • iShares S&P/TSX 60 Index Fund (XIU), $12.9 billion (CAD)
  • iShares DEX Short term Bond Index ETF (XSB), $2.26 billion (CAD)
  • S&P 500 Index C$-Hedged ETF (XSP), $2.03 billion (CAD)
  • iShares 1-5 Yr Laddered Corporate Bond Fund (CBO), $1.9 billion (CAD)
  • iShares DEX Universe Bond Index ETF (XBB), $1.5 billion (CAD)

With over $55 billion in total ETF assets and more than 500 product listing, France is home to one of the largest ETP markets in Europe. Exchange-traded products first began trading in Paris in 2001, and since then the ETP market has grown. Recently, Euronext Paris introduced its NAV Trading Facility, making it the first exchange to offer a regulated on-exchange forward pricing solution for order execution at Net Asset Value (NAV).

Major Players:France

  • Amundi
  • Deutsche Bank
  • HSBC
  • iShares
  • Lyxor
  • SPDR
  • BNP Paribas

Most Popular Funds

  • Lyxor UCITS ETF Euro Stoxx 50 (MSE), €4.5 billion
  • Lyxor UCITS CAC 40 (CAC), €3.0 billion
  • Gold Bullion Securities (GBS), €3.8 billion
  • db x-trackers MSCI Emerging Markets Index UCITS ETFs (XEM), €2.4 billion
  • Amundi ETF Govt Bond Lowest Rated Euromts Investment Grade UCITS ETF (X1G), €1.3 billion

The Bottom Line

Though the U.S. still dominates the ETF space, several countries have also come to embrace ETPs. If the industry continues on its upward trend, more and more investors worldwide will be able to take advantage of the easy and low-cost investment vehicles.