Thematic products top ETF fund flows


Kanish Chugh

Investors’ enthusiasm for megatrends and thematic exposures has returned, with strong flows into ETFs providing exposure to battery technology, robotics and automation so far this year – leading ETF provider ETF Securities reports.

According to ETF Securities’ annual fund flow data, investors directed their funds to the safe haven assets of gold and silver as the COVID-19 pandemic hit last year, while still steadily building their holdings in the thematic products. Those dynamics have reversed this year.

In the six months to 30 June 2020, demand for the safe haven asset, gold, dominated flows into ETF Securities’ Australian funds. Investors paid $467.8 million for units in ETFS Physical Gold (ASX code: GOLD), which was more than 80% of the group’s total flows over the period.

Other ETFs that recorded strong flows in the second half of 2019/20, as the full force of the pandemic hit, were ETFS FANG+ (ASX code: FANG), ETFS Morningstar Global Technology ETF (ASX code: TECH) and ETFS Physical Silver (ASX code: ETPMAG).

Kanish Chugh, Head of Distribution ETF Securities, said: “The story has developed this year. Taking inflow figures from the beginning of the year to the end of June, flows into ETFS Battery Tech & Lithium ETF (ASX code: ACDC) accounted for more than 36% of total flows over the period.

“The significant support from investors especially new investors that have entered the market over the past 18 months into our ‘Future Present’ range highlights how comfortable they are to incorporate and even build their portfolios around thematic exposures. Many investors understand now how to use thematic ETFs to capture the growth of long-term megatrends such as battery technology and robotics, automation and artificial intelligence.

“There was still strong support for gold and silver, with flows into ETFS Physical Gold (GOLD) accounting for 28% of total flows so far this year and ETFS Physical Silver (ETPMAG) receiving more inflow than last year.”

Other tech focused ETFs that have attracted strong flows this year include ETFS Morningstar Global Technology ETF (TECH) and ETFS ROBO Global Robotics and Automation ETF (ASX code: ROBO).

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