March Australian ETF Review: Records broken for FUM and trading value

Alex Vynokur

Alex Vynokur

The Australian exchange traded fund industry hit a new record high of $17.6 billion in funds under management (FUM) in March, up from $16.8 billion in FUM recorded in February, according to the BetaShares Australian ETF Review – March 2015. Growth in the industry over the last 12 months has been a rapid 66%.

The majority (85%) of this month’s growth came from new money flows, rather than market movements, with $700 million of net new money entering the industry in March.

The average trading value increased 25% to $1.9 billion, up from $1.5 billion in February, the highest monthly trading value on record.

Inflows were highest in international equities, in both developed and emerging markets categories. Redemption activity was very low and was largely restricted to unhedged gold.

Product development activity remained strong, with two new products launched in March, bringing the total number of products launched this year so far to nine, compared to a total of 12 new products for the whole of 2014.

BetaShares Managing Director Alex Vynokur said: “March has been another strong month for the exchange traded fund industry in Australia, with FUM hitting a record $17.6 billion. This again demonstrates how investor demand and interest in exchange traded products is going from strength to strength.

“The record high in monthly trading value shows investors are using exchange traded products beyond ‘buy and hold’, and are now regularly making use of ETFs to take tactical positions on market movements.

“In what is a significant industry milestone, the first ‘active’, non-transparent exchange traded product was also launched in March. The reception and interest in the product demonstrates how rapidly the industry is maturing,” Mr Vynokur added.

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