Weaker Markets Hit ETF, ETP Assets In 2018

Tom Burroughes

10 January 2019

Exchange traded funds and products weren’t able to withstand gravity at the end of last year, as falling equities dragged total assets under management down in December, new figures showed. Even so, money continued to flow into these low-cost entities.

Total assets invested in the global ETF and ETP industry fell 5.28 per cent by the end of December, from $5.06 trillion at the end of November, to $4.79 trillion, , a research business tracking the sector, said.

Across the sector, these entities gathered net inflows of $76.24 billion during December. For the whole of last year, inflows were $516 billion, below the $654 billion figure in 2017.

“The end of 2018 saw the trend in developed markets reverse, and although arguably predictable, the severity left many pundits scratching their heads. This end of year stress has widely been attributed to the disruption caused by trade disputes feeding into economic data, and the view policy makers are not going to be quite as accommodating as initially expected,” Deborah Fuhr, managing partner and founder of ETFGI, said.

AT the end of last year there were a total of 7,657 ETFs/ETPs, with 14,993 listings.

ETFs are typically open-ended, index-based funds, with active ETFs and can be bought and sold like ordinary shares on a stock exchange and offer broad exposure across developed, emerging and frontier markets, equities, fixed income and commodities. Exchange traded products are products that have similarities to ETFs in the way they trade and settle but do not use an open-end fund structure.