Below is a preview from Barclays Global Investors monthly ETF Landscape Industry Review which we are currently writing. The full report will be published in a few weeks. Please click here for a downloadable copy
Global ETF and ETP Industry 2009:
- Global Exchange Traded Products "ETP" AUM breaks through US$1 trillion - all time high.
- Global ETF assets have hit an all time high of US$942 bn at the end of October 2009 – 0.9% above the previous all time high of US$933 bn set in Q3 2009.
- At the end of October 2009 the Global ETF industry had 1,859 ETFs with 3,327 listings, assets of $941.85 billion, from 97 providers on 40 exchanges around the world.
- YTD assets have risen by 32.5% which is more than the 20.2% rise in the MSCI World index in USD terms.
- YTD the number of ETFs increased by 16.8% with 336 new ETFs launched, while 73 ETFs were closed.
- In Q2 the number of ETFs listed in Europe surpassed the US with 801 ETFs listed in Europe, compared to 732 in the US .
- There are currently plans to launch 805 new ETFs.
- YTD the number of exchanges with official listings decreased by three to 40.
- YTD the average daily trading volume in USD decreased by 7.7% to US$74.4 Billion.
- MSCI ranks 1st in terms of ETF AUM tied to their benchmarks with assets of US$222.66 Bn and 267 ETFs, while Standard & Poors (S&P) ranks 2nd with US$218.83 Bn and 229 ETFs, followed by Barclays Capital in 3rd with US$81.33 Bn and 62 ETFs.
- Globally, iShares is the largest ETF provider in terms of both number of products, 405 ETFs, and assets of US$455.72 Bn, reflecting 48.4% market share; State Street Global Advisors is second with 106 products and US$137.08 Bn, 14.6% market share; followed by Vanguard with 40 products and assets of US$80.76 Bn and 8.6% market share at the end of October 2009.
- Globally, net sales of mutual funds (excluding ETFs) were US$155.2 Bn, while net sales of ETFs were US$76.8 Bn during the first eight months of 2009 according to Strategic Insight.
- Additionally, there were 569 other ETPs (Exchange Traded Products)1 with assets of US$139.70 Bn from 40 providers on 19 exchanges.
- Combined, there were 2,428 products with 4,166 listings, assets of US$1,081.54 Bn from 124 providers on 43 exchanges around the world.
- FINRA, the Financial Industry Regulatory Authority which regulates all securities firms doing business in the US , issued a regulatory notice in June 2009 to provide guidance on leveraged and inverse ETFs. The notice states that "...inverse and leveraged ETFs that are reset daily typically are unsuitable for retail investors who plan to hold them for longer than one trading session, particularly in volatile markets...".
- The Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA) issued an Investor Alert on Tuesday 18 August 2009 entitled 'Leveraged and Inverse ETFs: Specialized Products with Extra Risks for Buy-and-Hold Investors'. The following is taken from the Alert: The SEC staff and FINRA are issuing this Alert because we believe individual investors may be confused about the performance objectives of leveraged and inverse exchange-traded funds (ETFs). Leveraged and inverse ETFs typically are designed to achieve their stated performance objectives on a daily basis. Some investors might invest in these ETFs with the expectation that the ETFs may meet their stated daily performance objectives over the long term as well. Investors should be aware that performance of these ETFs over a period longer than one day can differ significantly from their stated daily performance objectives.
- U.S. Commodity Futures Trading Commission (CFTC) held hearings on Energy Position Limits and Hedge Exemptions on July 28, July 29 and August 5, on whether federal position limits should be set on the energy markets. The hearings provided critical input from a wide range of industry participants and academics to the Commission's efforts to examine different approaches to regulate energy markets. The Commodity Exchange Act states that the Commission shall impose limits on trading and positions as necessary to eliminate, diminish or prevent the undue burdens on interstate commerce that may result from excessive speculation. The CFTC's hearings examined the role of position limits in energy markets in fulfilling the CFTC's mission to ensure the fair, open and efficient functioning of futures markets. Goldman Sachs, JPMorgan Chase and other leading banks are exempt from most commodity-trading limits in order to manage risks as they serve as market makers. The Commodity Futures Trading Commission is looking into whether those exemptions should stand, as it considers blanket limits on a variety of commodity markets. A number of ETPs/ ETFs providing exposure to commodities have recently issued notices that they have suspended their creation process.
US ETF and ETP Industry 2009:
- US ETF assets have hit an all time high of US$640 Bn at the end of October 2009 which tops the previous all time high of US$631 Bn set in Q3 2009.
- At the end of October 2009 the US ETF industry had 732 ETFs, assets of $639.58 billion, from 25 providers on 3 exchanges.
- 29 January 2009 marked the 16th anniversary of ETFs in the US .
- YTD assets have risen by 28.7%, which is more than the 15.3% rise in the MSCI US index in USD terms.
- YTD the number of ETFs increased by 4.9% with 75 new ETFs launched, while 42 ETFs were delisted.
- YTD the average daily trading volume in US dollar has decreased by 10.3% to US$69.1 Bn.
- iShares is the largest ETF provider in terms of both number of products, 183 ETFs, and assets of US$341.21 Bn, reflecting 53.3% market share; State Street Global Advisors is second with 87 products and US$126.12 Bn, a 19.7% market share; followed by Vanguard with 39 products, assets of US$80.72 Bn and 12.6% market share at the end of October 2009.
- In the US , net sales of mutual funds (excluding ETFs) were minus US$47.1 Bn, while net sales of ETFs domiciled in the US were positive US$55.1Bn in the first eight months of 2009 according to Strategic Insight.
- Additionally, there were 137 other ETPs (Exchange Traded Products) with assets of US$78.86 Bn from 18 providers on 1 exchange.
- Combined, there were 869 products with assets of US$718.44 Bn from 39 providers on 3 exchanges in the US.
European ETF and ETP Industry 2009:
- European ETF assets have hit an all time high of US$206 bn at the end of October 2009 which is 0.6% above the previous all time high of US$204 bn set in Q3 2009 and 28.6% above the high of US$160 bn recorded in July 2008.
- At the end of October 2009 the European ETF industry had 801 ETFs with 2,001 listings, assets of $205.54 Bn, from 32 providers on 18 exchanges.
- 11 April 2009 marked the ninth anniversary of ETFs in Europe.
- YTD assets have risen by 44.2%, which is greater than the 25.5% rise in the MSCI Europe index in USD terms.
- YTD the number of ETFs increased by 26.7% with 193 new ETFs launched.
- YTD the number of exchanges with official listings decreased by three to 18.
- YTD the average daily trading volume in US dollar has increased by 34.0% to US$3.0 Bn. Most ETF trades are not required to be reported in Europe as ETFs are not covered by the European Union directive on markets in financial instruments (MiFID).
- iShares is the largest ETF provider in terms of both number of products, 168 ETFs, and assets of US$80.20 Bn, reflecting 39.0% market share; Lyxor Asset Management is second with 118 products and US$41.94 Bn, 20.4% market share; followed by db x-trackers with 113 ETFs and assets of US$34.53 Bn and 16.8% market share at the end of October 2009.
- In Europe net sales of mutual funds (excluding ETFs) were US$174.7 Bn while net sales of ETFs domiciled in Europe were US$23.6 Bn during the first eight months of 2009 according to Lipper FMI.
- Additionally, there were 150 other ETPs (Exchange Traded Products) with assets of US$17.96 Bn from 5 providers on 6 exchanges.
- Combined, there were 951 products with assets of US$223.51 Bn from 33 providers on 18 exchanges in Europe.