Invest
ETF rush predicted to intensify
The Australian ETF sector advanced AU$6.3 billion in August to hit a new milestone, as its popularity among financial advisers soared.
ETF rush predicted to intensify
The Australian ETF sector advanced AU$6.3 billion in August to hit a new milestone, as its popularity among financial advisers soared.
ETFs are set to get more popular, as registered financial professionals continue to recognise their value, according to an industry leader.
Speaking to ifa, Kanish Chugh, head of distribution at ETF Securities, explained that their growth in popularity can be attributed to several trends including a “changing of the guard”, as a younger generation of financial advisers and other investment professionals enter the industry.
Noting a “steady adoption of ETFs from investment professionals over the past five or six years”, Mr Chugh said increased knowledge of ETF products has also boosted their popularity, catapulting the industry forward in the last two years.
“Fifteen years ago, 10 years ago even, ETFs were a relatively unused investment vehicle,” Mr Chugh said.
“The adoption of ETFs has had a rapid growth in the past two to three years.”
What has helped drive this change is the acknowledgment of the demand for more flexible and cost-effective products by younger investment professionals.
“The pressure on outperforming their benchmarks and the fees that they are charging, I think that has been what has helped investors make the decision to look at ETFs,” Mr Chugh stated.
ETFs sit within the space of exchange traded products (ETPs), and according to Mr Chugh, the boom in ETFs sits within a wider success story that is only picking up in momentum.
There is “AU$128.2 billion in ETPs (currently) listed on the ASX”, he said.
“In August 2020, it was AU$70.5 billion.”
The latest BetaShares Australian ETF review revealed that the ETF sector has broken another significant milestone with a record-high market cap of AU$125.1 billion recorded in August.
Australia’s ETF and ETP growth is hardly an isolated occurrence, with the patterns seen mimicking global trends in the space.
ETFGI, an independent research and consultancy firm, confirmed that record assets and net inflows of US$9.73 trillion and US$834 billion in ETFs and ETPs, listed globally, were recorded at the end of August, following 27 months of consecutive net inflows.
Much like what has been seen in Australia, the global narrative is one in which interest for ETPs has gathered in the last few years, with 2021 proving to be a vital flashpoint.
The report found that global net inflows of the YTD for ETPs jumped to US$834.21 billion. The same figure for the whole of 2020 was recorded at US$762.77 billion.
In the past 12 months, the global ETP industry has seen US$1.78 trillion in net inflows.
Stock market
Trading app popularity skyrockets as retail sector booms
In 2021, trading has never been easier for retail investors, meaning the number of users on trading applications has exploded to an all-time high. ...Read more
Stock market
The 6 unique Australian market affects that all active managers can exploit
The uniqueness of the Australian equities market is providing fund managers with an opportunity to essentially beat the market, new research has revealed. ...Read more
Stock market
‘Don’t believe the hype’: ASIC warns of risks for new market participants
ASIC has expressed concern that inexperienced or uninformed investors are putting their capital at unnecessary risk when tempted into the market by questionable marketing strategies from market promot...Read more
Stock market
How do you choose the best ETFs?
In recent years, exchange-traded funds have become an increasingly popular option among Aussie investors. ...Read more
Stock market
Lockdowns instigate a rise in new investors
Despite COVID-19 leaving individuals and businesses to face an uncertain future, retail investors’ appetites for shares have increased throughout the pandemic, a new report has found. ...Read more
Stock market
‘Code red for humanity’ a wake-up call for private and public investment
Retail investors that have been advocating for sustainable and ESG investing are hoping a new report released by the United Nations will serve as a wake-up call to the financial industry and governmen...Read more
Stock market
Rising inflation set to help the next super cycle for investors
Central banks around the world are largely tipped to increase interest rates over the medium term due to inflationary pressures, with investors urged to look at the upcoming growth cycles that will em...Read more
Stock market
4 international stocks all investors should be watching
With markets around the world reaching record highs after the COVID-19 lockdown, Australian investors are being urged to keep an eye on four foreign stocks tipped to outperform. ...Read more
What to expect as the end of lockdown looms? Will the Stage 2 tax cuts boost your tax return? Where should investors be looking as the economy reopens?
Listen now
Could property prices inflate by another 20%? What’s happening in recent dividend announcements? Did your fund fail the YFYS test?
Listen now
What does the NSW regional permit mean for property investors? Who really wins from the BHP-Woodside merger?
Listen now
The sea and tree-change norm; Square’s acquisition of Afterpay; Why you should think twice before turning to TikTok for advice
Listen now
Stock market
Trading app popularity skyrockets as retail sector booms
In 2021, trading has never been easier for retail investors, meaning the number of users on trading applications has exploded to an all-time high. ...Read more
Stock market
The 6 unique Australian market affects that all active managers can exploit
The uniqueness of the Australian equities market is providing fund managers with an opportunity to essentially beat the market, new research has revealed. ...Read more
Stock market
‘Don’t believe the hype’: ASIC warns of risks for new market participants
ASIC has expressed concern that inexperienced or uninformed investors are putting their capital at unnecessary risk when tempted into the market by questionable marketing strategies from market promot...Read more
Stock market
How do you choose the best ETFs?
In recent years, exchange-traded funds have become an increasingly popular option among Aussie investors. ...Read more
Stock market
Lockdowns instigate a rise in new investors
Despite COVID-19 leaving individuals and businesses to face an uncertain future, retail investors’ appetites for shares have increased throughout the pandemic, a new report has found. ...Read more
Stock market
‘Code red for humanity’ a wake-up call for private and public investment
Retail investors that have been advocating for sustainable and ESG investing are hoping a new report released by the United Nations will serve as a wake-up call to the financial industry and governmen...Read more
Stock market
Rising inflation set to help the next super cycle for investors
Central banks around the world are largely tipped to increase interest rates over the medium term due to inflationary pressures, with investors urged to look at the upcoming growth cycles that will em...Read more
Stock market
4 international stocks all investors should be watching
With markets around the world reaching record highs after the COVID-19 lockdown, Australian investors are being urged to keep an eye on four foreign stocks tipped to outperform. ...Read more
More articles
Website Notifications
Get notifications in real-time for staying up to date with content that matters to you.
