December was the best month on record for global exchange-traded product flows, Ursula Marchioni, head of ETP research at iShares EMEA, has said.
She said: “The exchange-traded funds industry has come of age with ETFs being used by new client types and for new applications, and aided by deeper liquidity and larger assets under management.”
The European ETF market finished the year with the one of the highest organic growth rates compared to other regions, according to Ms Marchioni, with inflows for Europe-listed ETPs totalling £40bn.
The data from iShares, part of asset manager BlackRock, showed that December’s total sales topped £39.5bn, making it a blockbuster year as the industry finished with £217bn of inflows.
Encouraging news on the US economic outlook, a strong dollar and a further drop in the price of oil sparked a late-month equity rally and caused the surge in global inflows, Ms Marchioni added.
Adviser View
Jason Witcombe, director of London-based Evolve Financial Planning, said: “It does not surprise me that there has been a big move towards lower-cost funds, such as passive, over recent years, and the ETP market will clearly benefit.
“I suspect that passive fund management in the UK will show a similar trend. Retail investors will continue to be attracted to ETFs – it is not just an active verses passive issue, but more of a cost decision for investors who are becoming increasingly aware that cost is one of the few variables of investing that you can control.”
