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Frank Koudelka, State Street Global Services
Frank Koudelka, State Street Global Services

Trackinsight 2024 Global ETF survey reveals ETF assets at USD11trn

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ETF data provider and ETF Express data partner, Trackinsight, has published its Global ETF Survey 2024 Report: ‘50+ Charts on Worldwide ETF Trends’, in partnership with J.P. Morgan Asset Management and State Street.

The fifth annual survey, provides a comprehensive analysis of the ETF industry, covering trends, growth, and innovation. It leverages Trackinsight’s global database of over 10,000 ETPs and features insights from more than 500 investment professionals managing ETF assets exceeding USD900 billion.

The year 2023 saw ETF assets soar to USD11 trillion, showcasing continuous expansion. Europe’s assets increased by almost USD400 billion, edging closer to the USD2 trillion milestone, the firm says.

In North America, active ETF strategies captured 25 per cent of 2023 flows, bringing the category’s total assets in the region to USD630 billion – a new record. In contrast, Europe, where interest is slowly growing, lags significantly with only USD32 billion in assets, emphasising investors’ ongoing preference for passive strategies, the firm says.

Global interest in thematic investing in 2023 continues to be subdued when compared to the levels seen during the pandemic years, the firm says. AI, Robotics, and Automation themes take the global spotlight with USD3.6 billion in inflows in the US and Europe, while the Nuclear Energy theme sees a surge in the US with USD1 billion in new capital. Europe’s commitment to Net Zero 2050 and Climate Change themes remains strong with over USD10 billion in new inflows.

In 2023, global interest in cryptocurrency ETPs rejuvenated amid US Spot Bitcoin ETFs approval rumours, attracting over USD1.5 billion in North America and more than USD1 billion in Europe, marking the end of the crypto winter. Recently, the US overtook Europe and Canada in the crypto asset arena following a bulk approval and launch of Spot Bitcoin ETFs on US exchanges.

In 2023, Europe reaffirmed its global leadership in the ESG market, injecting an impressive USD50 billion into ESG ETFs, Trackinsight writes. “Europe now commands a remarkable 75 per cent share of the global USD550 billion ESG ETF assets, reaching an all-time high. Conversely, the United States faces a growing gap, primarily due to political pushback across party lines.”

The fixed income asset class witnessed a revival in 2023, propelling its global ETF assets to the USD2 trillion threshold, Trackinsight says. In Europe, there were USD66 billion in inflows, double the amount from the previous year, bringing the region’s total assets closer to the half-trillion-dollar mark.

Investors are strategically expanding their allocations to diverse asset classes via ETFs, with a pronounced focus on equity and fixed income, the firm writes. 

“European investors continue to prioritise ESG investing, and interest in active management is widespread across different regions. Thematic investing appetite is present but in a minor satellite exposure capacity, while caution prevails when it comes to cryptocurrencies.”

Philippe Malaise, CEO of Trackinsight, says: “This year’s Global ETF Survey underscores the vibrant expansion and the transformative potential of the ETF industry. Our collaboration with JP Morgan and State Street has enabled us to present a report that not only captures the current state of the market but also offers forward-looking insights that will benefit investors and industry stakeholders alike. The findings highlight the adaptability of ETFs to market changes and investor needs, reinforcing their essential role in contemporary investment strategies.”

“We coined the phrase ETF 3.0 several years ago, as a description of the exponential growth we expected to see for active ETFs globally. The 2024 survey results echo our predictions,” says Francis Koudelka, Senior Vice President & Global ETF Product Specialist at State Street.

 “Global investors are telling us they are allocating more to active ETFs, would be more apt to purchase a strategy if it was converted from a mutual fund to ETF, and would like to see global regulators enable a listed ETF as a share class of an unlisted fund. We remain bullish on the growth of active ETFs globally.”

Travis Spence, Head of ETF Distribution in EMEA at J.P. Morgan Asset Management, says: “ETFs remain one of the fastest growing parts of the asset management industry and with nearly 80 per cent of ETF buyers in EMEA planning to increase their allocation to active ETFs in the next couple of years, we believe the future of ETFs is active. Not only are we seeing existing ETF buyers starting to rotate into active ETFs, we’re also starting to see users of traditional active management increasingly embracing the ETF wrapper, alongside mutual funds. We’re also seeing increasing interest in active fixed income ETFs which can allocate towards higher-quality issuers and away from those issuers at risk of downgrades. Active management can produce better investment outcomes, particularly when it comes to sustainable investing, where fundamental active research can take into account financially materially factors, combined with engagement.”

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