The Australian exchange traded fund industry reached a new record high of AUD18.6 billion in funds under management in its sixteenth straight month of positive growth, according to the BetaShares Australian ETF Review – May 2015.
The market grew by AUD900 million over the month, with approximately 60 per cent of growth coming from market movements and the remaining 40% from new money inflows.
In a record month for product development, 20 new Exchange Traded Products (ETPs) were launched on the ASX.
BetaShares Managing Director Alex Vynokur says the strong product development activity in the industry over the first half of the year showed providers were seeing increased opportunities in the local market. For example, the recently launched BetaShares Nasdaq 100 ETF (ASX code: NDQ) provides Australian investors with convenient and cost effective way to access some of the world’s most revolutionary companies, including household names such as Apple, Microsoft and Google.
“2015 is turning out to be a big year for ETP product growth,” says Vynokur. “We have already seen 29 ETPs launch in the first five months of the year, more than double the amount of products launched over the whole of 2014.”
Inflows in May were highest in broad Australian equities and developed international equities products, with particularly strong flows into European exposures. Redemptions were largely restricted to emerging markets exposures.
Vynokur says with investor demand and new product activity remaining strong, the ETF market was on track to exceed projected levels of growth by the end of the year.
“With a multitude of new products launched and a lot more expected in the latter half of the year, we believe the market may exceed our initial expectation of AUD23 billion in FUM by the end of 2015,” he says.