ETFs now $9 billion in assets under management.

The Australian exchange traded fund market has broken through $9 billion in assets under management, reaching a fresh record high of $9.3 billion, according to BetaShares’ October ETF Review.

The industry’s market cap grew 5.3% during October, which included $256 million of net new money flowing into the market.

In what has been a recurring theme for the industry this year, investors were again bullish on international equities this month, with US and European equities products being amongst the top 10 in terms of inflows. The search for yield continues to be a strong theme, with equity yield products and the high interest cash ETF also included in the top 10 products for inflows.

, Managing Director of BetaShares said: “This month’s inflows suggest investors are improving their outlook on global equities, as the US market rallied following the resolution of the government shutdown, and with European markets also recording moderate gains.” The US dollar and Euro currency ETFs experienced outflows as investors rotated from just foreign currency exposures to foreign equity market exposures again, indicating resurging optimism in the global equity markets.

Sentiment towards the local market and Australian dollar also improved, with the BEAR fund, designed to go up when the market goes down and vice versa, experiencing net redemptions for the first time since April 2013.

The best performing product for the month was the BetaShares Financials Sector ETF:

“With the Australian banks recording a solid reporting season in October, it wasn’t surprising to see financials ETFs perform strongly as investors continue to back bank stocks”.

“Overall, with two months to go until the end of the year, it looks as though the ETF industry will reach its $10 billion milestone. An increasing number of investors are continuing to embrace ETFs for a wide variety of investment strategies and uses,” Mr Vynokur concluded.

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