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Fixed income ETPs lead all categories in asset growth in 2011, says BlackRock


Fixed income exchange traded products (ETPs) were the ETP marketplace’s fastest growing asset category in 2011, with assets under management (AUM) increasing by 24.4 per cent, or USD50.6 billion, compared with 2010, according to the Year End “ETP Landscape” report released by the BlackRock Investment Institute.  Global fixed income ETP assets now total USD258 billion.

The Year End “ETP Landscape” report notes that while flows into equity and commodity categories have been up and down throughout the year, fixed income ETPs have displayed resilience, garnering new flows for every month in 2011 and showcasing the popularity of this asset class in a tumultuous year for global markets.  The category’s expansion was largely driven by US-listed products, with investors in European-listed products remaining on the sidelines due to sovereign and bank debt concerns.

The global ETP industry ended the year with USD1.525 trillion in AUM, up 2.9 per cent from USD1.482 trillion at year-end 2010.  Net inflows totaled USD151.9 billion in 2011.
In December, ETPs globally gathered net inflows of USD14.2 billion, compared with net outflows of USD0.6 billion in November.
The developed market equity category grew by 3.3 per cent in 2011, with healthy net inflows of USD93 billion offset by negative market return of -USD65.5 billion, for net growth of USD27.7 billion in AUM.  Despite the year’s serious macro-economic challenges, ETPs offering equity exposure to the US and Europe captured more new money in 2011 (USD48.8 billion and USD15.0 billion, respectively) than in 2010 (USD40.1 billion and USD8.7 billion).
The emerging market equity category contracted by 18.7 per cent, due to negative market return of -USD43 billion and net redemptions of USD1.8 billion for the year.  By comparison, the category attracted USD40.5 billion in net inflows in 2010.
The US remains the largest and most mature market in the ETP industry, with asset growth of 5 per cent in 2011.  US ETP assets now total USD1.061 trillion, representing 69.6 per cent of global AUM.  Product offerings grew by 26.7 per cent, with 308 new products launched and 37 de-listed.
European assets ended the year down 5.3 per cent from 2010.  European assets now total USD298.5 billion, representing 19.6 per cent of global AUM.  Product offerings grew 13.3 per cent, with 258 new products launched and 47 de-listed.  European-listed ETPs offering exposure to German equities delivered strong asset gathering results in 2011, representing 97 per cent (USD17.3 billion) of all flows into equity products listed in Europe during the year.
Asia Pacific (inc. Japan) assets grew by 8.3% in 2011, and now total USD92.6 billion.  The region now represents 6.1 per cent of global AUM.  Product offerings grew 38.5 per cent, with 123 new products launched and three de-listed.


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