Register For Our Mailing List

Register to receive our free weekly newsletter including editorials.

Home / 388

November 2020 was an historic month for ETFs

This article is an extract from the BetaShares Australia ETF Review for November 2020. There are now 257 Exchange Traded Products trading on ASX and Chi-X.

Firstlinks regularly includes monthly and quarterly ETF reviews in its Education Centre, and we are highlighting ETFs this month due to the historic milestones:

  • November 2020 saw industry records broken for absolute Funds Under Management (FUM), absolute dollar monthly FUM growth, annual growth in FUM and largest net flows on record amongst others
  • A notable event this month was the conversion of Magellan’s Global Fund into an ‘Open Class’ structure which permits applications and redemptions both on and off market. The entire $13.5 billion in that strategy has been ‘ported’ across to the ETF industry data. We’ve included the converted fund for FUM purposes in the numbers below but, given it’s a structural change not a net flow, have excluded from the monthly flow figures
  • Including this conversion the industry’s market cap is now $92.3 billion, although, even without it, the industry rose to a record high of $78.7 billion, representing an almost $5 billion monthly FUM increase, smashing the previous record of $4.1 billion recorded in January 2020
  • For the third month in a row, the Australian ETF industry broke its all-time net flows record, receiving $2.5 billion of net flows, surpassing the previous record from last month ($2.3 billion)
  • Including the Magellan conversion, industry growth over the last 12 months has been 52%, representing absolute growth of $31.6 billion over this period
  • With sharemarkets rallying strongly in November, we saw an almost even mix between asset value appreciation and net new money.
  • Trading value remained strong with ~$8.3 billion traded which represented a 19% month-on-month growth
  • Three new products were launched this month, all of which were Active ETFs. Apart from Magellan’s conversion, new funds were launched by Munro and Loftus Peak in the global equities space
  • As has been the case since the COVID crisis, equities exposures dominated net flows this month, and this month, particularly the case with international equities ($1.2 billion of net flows).
  • We saw outflows in cash and short exposures, both of which may be the result of markets rallying and investors positioning for a risk-on allocation.

Figure 1: Australian ETP Market Cap: August 2001 – November 2020

CAGR: Compound Annual Growth Rate. Source: ASX, Chi-X, BetaShares. Note, in November 2020, Magellan restructured a large international unlisted exposure to an open class structure and this fund (MGOC) will be included in ETF figures going forward.

Top 10 Products: November 2020

By Market Cap

Other products with > $1B AUM: VAP, VEU, IAF, VAF, VHY, QUAL, MVW, NDQ, VGAD, A200

Top 10 Inflows (by $) - Month

Top 10 Outflows (by $) - Month

Top 5 Category Inflows (by $) – November 2020

Top Category Outflows (by $) – November 2020

Figure 2: ASX ETF Flows by Asset Class - Last 4 Months (A$m)

Top 5 Sub-Category Inflows by ($) – November 2020

Top Sub-Category Outflows by ($) – November 2020

ETF Issuer Flows – YTD 2020

 


 

Leave a Comment:

     

RELATED ARTICLES

ETFs and the eight biggest worries in index investing

ETFs are the Marvel of listed galaxies, even with star WAR

Australian ETFs: end of year reviews 2018

banner

Most viewed in recent weeks

Is it better to rent or own a home under the age pension?

With 62% of Australians aged 65 and over relying at least partially on the age pension, are they better off owning their home or renting? There is an extra pension asset allowance for those not owning a home.

Too many retirees miss out on this valuable super fund benefit

With 700 Australians retiring every day, retirement income solutions are more important than ever. Why do millions of retirees eligible for a more tax-efficient pension account hold money in accumulation?

Is the fossil fuel narrative simply too convenient?

A fund manager argues it is immoral to deny poor countries access to relatively cheap energy from fossil fuels. Wealthy countries must recognise the transition is a multi-decade challenge and continue to invest.

Reece Birtles on selecting stocks for income in retirement

Equity investing comes with volatility that makes many retirees uncomfortable. A focus on income which is less volatile than share prices, and quality companies delivering robust earnings, offers more reassurance.

Superannuation: a 30+ year journey but now stop fiddling

Few people have been closer to superannuation policy over the years than Noel Whittaker, especially when he established his eponymous financial planning business. He takes us on a quick guided tour.

Comparing generations and the nine dimensions of our well-being

Using the nine dimensions of well-being used by the OECD, and dividing Australians into Baby Boomers, Generation Xers or Millennials, it is surprisingly easy to identify the winners and losers for most dimensions.

Latest Updates

Superannuation

Superannuation: a 30+ year journey but now stop fiddling

Few people have been closer to superannuation policy over the years than Noel Whittaker, especially when he established his eponymous financial planning business. He takes us on a quick guided tour.

Survey: share your retirement experiences

All Baby Boomers are now over 55 and many are either in retirement or thinking about a transition from work. But what is retirement like? Is it the golden years or a drag? Do you have tips for making the most of it?

Interviews

Time for value as ‘promise generators’ fail to deliver

A $28 billion global manager still sees far more potential in value than growth stocks, believes energy stocks are undervalued including an Australian company, and describes the need for resilience in investing.

Superannuation

Paul Keating's long-term plans for super and imputation

Paul Keating not only designed compulsory superannuation but in the 30 years since its introduction, he has maintained the rage. Here are highlights of three articles on SG's origins and two more recent interviews.

Fixed interest

On interest rates and credit, do you feel the need for speed?

Central bank support for credit and equity markets is reversing, which has led to wider spreads and higher rates. But what does that mean and is it time to jump at higher rates or do they have some way to go?

Investment strategies

Death notices for the 60/40 portfolio are premature

Pundits have once again declared the death of the 60% stock/40% bond portfolio amid sharp declines in both stock and bond prices. Based on history, balanced portfolios are apt to prove the naysayers wrong, again.

Exchange traded products

ETFs and the eight biggest worries in index investing

Both passive investing and ETFs have withstood criticism as their popularity has grown. They have been blamed for causing bubbles, distorting the market, and concentrating share ownership. Are any of these criticisms valid?

Sponsors

Alliances

© 2022 Morningstar, Inc. All rights reserved.

Disclaimer
The data, research and opinions provided here are for information purposes; are not an offer to buy or sell a security; and are not warranted to be correct, complete or accurate. Morningstar, its affiliates, and third-party content providers are not responsible for any investment decisions, damages or losses resulting from, or related to, the data and analyses or their use. Any general advice or ‘regulated financial advice’ under New Zealand law has been prepared by Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892) and/or Morningstar Research Ltd, subsidiaries of Morningstar, Inc, without reference to your objectives, financial situation or needs. For more information refer to our Financial Services Guide (AU) and Financial Advice Provider Disclosure Statement (NZ). You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Articles are current as at date of publication.
This website contains information and opinions provided by third parties. Inclusion of this information does not necessarily represent Morningstar’s positions, strategies or opinions and should not be considered an endorsement by Morningstar.

Website Development by Master Publisher.