Alex Vynokur
Despite declines in the broader Australian market, net inflows lifted the Australian exchange traded fund (ETF) industry by 2.6% (or $733.7 million) to hit a new record high of $29 billion in funds under management (FUM), according to the BetaShares Australian ETF Review – May 2017.
Most of the month’s industry growth came from net new money ($657.8 million), rather than asset appreciation.
In line with previous months this year, Australian equities recorded the highest inflows with broad Australian exposures the most popular funds in May. Equity Income products were also popular, with the BetaShares HVST and YMAX funds receiving strong net flows.
The best performing exposures were Asian Equities, particularly Korean, followed by the Australian Equities Strong Bear Hedge Fund (ASX: BBOZ), which experienced positive performance of 7.6%, profiting from the decline of the Australian market.
BetaShares Managing Director, Alex Vynokur, said: “It’s exciting to see the industry approach the $30 billion milestone. We are confident this growth trajectory will only get stronger as investor demand and innovation drives more product launches to suit a diverse range of investor needs.”
“The continued growth of the ETF industry in May, despite the decline of the Australian share market shows its resilience and versatility for investors,” he added.
Two new products were launched on the Australian Securities Exchange in April: the VanEck Vectors Australian Corporate Bond Plus ETF (ASX: PLUS) and the UBS IQ Cash ETF (ASX: MONY), bringing the total number of exchange traded products on the ASX to 206.
“Over the next quarter, we expect to see more products based on the cash and fixed income asset classes launched, as investors seek income solutions outside of the volatile equity market,” concluded Mr Vynokur.