Smart beta equity ETPs reach record high

Assets invested in smart beta equity exchange-traded products (ETPs) and exchange-traded funds (ETFs) listed globally reached a record high of US$592 billion (€501 billion) at the end of the first half of 2017, according to new data.

A report published by London-based research and consultancy firm ETFGI found that assets in smart beta ETPs and ETFs increased 14.9%, compared with the the first half of 2016, from $515 billion to $592 billion, with a 5-year compound annual growth rate of 31.9%.

At the end of June 2017, there were 1,255 smart beta equity ETFs/ETPs, with 2,159 listings from 153 providers on 39 exchanges in 32 countries.

The report found that 89% of smart beta assets are invested in the 617 ETFs/ETPs that are domiciled and listed in the US and 76% of the assets are invested in smart beta ETFs/ETPs that provide exposure to the US market.

In the year to date, iShares gathered the largest smart beta ETF/ETP net inflows with $13.18 billion, followed by Vanguard with $7.81 billion and Charles Schwab Investment Management with $4.46 billion.

Products tracking S&P Dow Jones smart beta benchmarks gathered the largest net ETF/ETP inflows year to date with $11.62 billion.

“Equity markets have performed well in the first half of 2017: the S&P 500 gained 9.34%, international equity markets outside the US were up 14.27% and emerging markets were up 16.69%,” said ETFGI managing partner Deborah Fuhr.

Fuhr added that geo-political risks remain a focus for investors, particularly the ability of the Trump administration in the US to move forward on policy goals, hearings on Capitol Hill, Brexit negotiations and the North Korean missile crisis.

©2017 funds europe

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