Global ETP industry AUM grew 15% to over USD2.7 trillion in 2014 driven by record inflows and increased adoption, according to BlackRock’s Global ETP Landscape Review of the year.
Global ETP flows of USD267.9bn to the end of November surpassed the previous full-year record set in 2012, while increased adoption among institutions, intermediaries and individuals aided unprecedented expansion in the European and US markets.
Fixed income ETPs set a new record, gathering USD78.6bn as appetite for yield and slower than expected global economic growth helped assets swell 22% to USD430bn. ETPs in Europe meanwhile, gathered USD60.8bn, triple the amount last year, as market penetration increased and ECB bond purchases boosted fixed income flows.
Accelerating US GDP growth propelled US-listed ETP flows to a record USD193.5bn as demand for US equities and fixed income proved resilient.
According to BlackRock, themes to watch in 2015 include smart beta, emerging markets and Japan equity, all of which remain compelling following notable contributions to 2014 flows.
Ursula Marchioni, Head of ETP Research, EMEA at iShares, says: “The global ETP industry continues to grow at a double digit pace as ETPs attract a broader base of global investors than ever before. ETPs are being used by capital market participants looking for deep liquidity, by investors seeking precision exposures and by a growing segment of the market using ETFs as buy and hold investment vehicles at the heart of their portfolios."