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Asset Flows into ETFs Increase
February 8, 2011
SAN DIEGO (ETFguide.com) – A trend that was established in previous years continues into the New Year: More money is flowing into exchange-traded funds (ETFs).
Industry-wide assets in exchange-traded products increased by $8.8 billion during January according to State Street Global Advisors. The company also reported that investors added $9 billion more to ETFs than they withdrew – marking the fifth consecutive month of positive ETF flows.
While the shift into ETFs originally began with institutional investors, the trend is now spreading to financial advisors and retail investors. New data from Charles Schwab confirms this.
In its Q410 ETF Investor Snapshot, the San Francisco, CA-based brokerage firm says retail investor ETF assets have grown 61% over the past year and now account for 37% of the $110 billion in ETF assets held at Schwab. The company also says 85% of the registered investment advisors using its brokerage platform for their clients own ETFs.
Over the past year, assets inside Schwab ETFs have climbed six-fold from $516 million to $3.06 billion. Last year the company introduced online commission free trades for Schwab ETFs to garner more growth.
Meanwhile, ETF providers are adding more products to their menus.
Last week, Global X Funds launched the Global X FTSE Andean 40 ETF (NYSEArca: AND) which focuses on stocks from Chile, Colombia, and Peru. AND is linked to the performance of the 40 largest and most liquid companies in the Andean region and as of late January the three largest components were Southern Copper Corp., Minas Buenaventura and Pacific Rubiales Energy.
In related news, the Active Bear ETF (NYSEArca: HDGE) was launched. The fund aims for capital appreciation through short sales of domestically traded stocks. The HDGE portfolio is sub-advised by Ranger Alternative Management and the firm uses a bottom-up, fundamental, research driven security selection process. The fund’s net expense ratio is 1.85%. |
