November boost for equity stimulates record ETP flows

ETF trading2014 was the "best year ever" for exchange-traded products (ETPs), with year-to-date asset gathering in record territory at $268 billion (€215 billion).

Globally, ETPs attracted $40 billion in November, with investors returning to equities during the month after fixed income benefited from a stock market correction in October.

BlackRock's Global ETP Landscape for November 2014 also found that US equities brought in $36 billion, having experienced their highest inflows in over a year during the first week of the month.

Large-cap funds were mostly responsible, drawing in $22.7 billion as the outlook for the US economy improved and slowing global growth led to central bank easing in other regions.

Japanese equity ETPs listed in the US and Europe accumulated $4 billion, in response to Government Pension Investment Fund equity purchases and increased stimulus following the country's dip into recession.

However, the report also revealed that Japan-listed funds saw outflows, following a significant stock rally.

European fixed income achieved inflows of $2 billion, mainly in investment grade corporate debt, as the European Central Bank started bond purchases and commited to further action. In contrast, European equity ETPs remained unpopular.

Ursula Marchioni, head of ETP research for Europe, the Middle East and Africa at iShares, says that November inflows for the global ETP industry make the autumn month the strongest this year.

"This brings year-to-date flows to almost $270 billion making 2014 the best year ever in the ETP industry's history, surpassing the previous record of $262.7 billion recorded in 2012," she says.

She adds that the European ETP industry has seen year-to-date inflows of over $60 billion, making Europe the region with the highest organic growth rate for 2014.

©2014 funds europe