Some 69.8 per cent of all European-domiciled ETFs are equity ETFs, a significant majority despite a slight decrease this year compared with 2022 figures, says PwC Luxembourg in its latest European ETF Listing and Distribution 2023 poster.
The key data points from the poster include:
Growth trends
● Growth rate of EU-domiciled ETFs stands at 18.2 per cent: Between 2012 and June 2022, EU-domiciled ETFs have grown at a compound annual growth rate (CAGR) of 18.2 per cent, more than twice the growth rate of EU-domiciled UCITS (9 per cent) during the same period.
● Despite a slight decrease, the majority of ETF assets are still equity ETFs: 69.8 per cent of total European-domiciled ETFs are equity ETFs.
● Percentage of ESG ETFs: Nearly 33.0 per cent are ESG ETFs, classified as Article 8 or Article 9 funds.
● Top five Article 8 EU ETFs by AuM in H1 2023: BlackRock dominated the first three spots, followed by State Street Global Advisors and DWS.
● Top five Article 9 EU ETFs by AuM in H1 2023: UBS tops this ranking, followed by Legal & General, JP Morgan, Fidelity International and Legal & General rounding off the top five.
Market trends
● Top market players: Ireland was still the biggest domicile for ETFs, recording 16,496 cross-border registrations as of June 2023, with a sharp growth of 1,867 new registrations or 12.8 per cent globally. Among the 16,496 registrations, 95.9 per cent were distributed in Europe.
● Emerging markets in the ETFs space: The fastest growing markets are Denmark in Europe, Saudi Arabia in the Middle East, Japan in Asia, and Chile in the Americas.
Stock exchanges and ETF listings
● European cross-border ETF listings: European ETFs industry widely features cross-listing and cross-border registrations. As of June 2023, around 63.5 per cent of European ETFs were listed on 2 or more stock exchanges – a slight increase from 62 per cent in mid-2022.
● Cross-border ETF distribution rates: The rate of cross-border ETF distributions continues to increase, as demonstrated by the fact that the percentage of ETFs distributed in more than 14 markets has grown 2 percentage points to 57 per cent of all cross-border ETFs.
Robert J. Glover, Advisory Partner, Global Fund Distribution at PwC Luxembourg says: “The rise in the popularity of ETFs and mass adoption can be explained by their versatility and flexibility. Money market ETFs are a great option for investors who are looking for a safe and liquid investment subject to low volatility. As such, we are witnessing a significant increase in money market ETFs so far this year.
“We expect to see this trend continue, with much of this growth likely to take place in countries where ETFs are already prominent. As the benefits of ETFs become increasingly clear to investors and asset managers, we are confident that the global distribution of assets under management (AuM) will remain steadfast.”
