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Thematic ETFs emerge as “big winners” of 2020

thematic_etfs_sustainabilityEuropean thematic ETFs are said to be among the “big winners” of 2020 as their assets under management almost trebled despite ongoing market turbulence.

Record inflows into the investment vehicle of net €9.5 billion was largely due to the “eye-catching” returns thematic ETFs in Europe have been generating, a report by Morningstar said.

These inflows led to a surge in assets from €8.2 billion to an all-time high of €22.7 billion through the course of the turbulent year. 

According to the data, more than half of net inflows were channelled into energy transition or connectivity-themed funds.  

Not a single thematic ETF closed throughout the year, while 17 more were added to the market, the report also highlighted.

Kenneth Lamont, senior analyst, manager research of passive strategies at Morningstar said that Thematic ETFs in Europe emerged as one of the “big winners” in 2020, attracting a record in net new assets.

“The disruptive volatility experienced in the oil markets led many to seek alternatives and to reevaluate the associated risk and return of alternative energy sources. The favourable US election result and other pro-environmental political developments globally were also supportive,” he said. 

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