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Laxman Pai, Opalesque Asia: The European exchange-traded fund (ETF) market reached a "record" high last year as overall inflows surpassed 100bn ($110bn) for the first time.
European ETFs gathered a record 100.8bn in 2019, bringing total assets to 870bn (up 40 percent on 2018), according to Lyxor ETF Research's Money Monitor 2019 report.
ETFs now represent 7% of total European funds' assets (vs. 6% in 2018), with Equity ETFs accounting for 69% of the market, Fixed Income for 27% and Commodities for 3%, the remaining being in the other asset classes.
European investors turned to higher-yielding opportunities (Corporate Bonds, US Government Bonds, Emerging Markets Bonds, High Yield) and geographical diversification was key, mostly outside ope.
Whilst it's taken several years for the Fixed Income ETF segment to take off, the trend observed over the past 5 years looks solid and resilient with an average 26bn of annual inflows.
With regards to Equities, 2019 was a year of contrasts. European equity markets bore the brunt of rising macro-economic uncertainties. There was the threat of 'no deal' Brexit in the first half, but the second half saw a sharp rebound on the back of easing trade tensions.
ETFs benefitted from the rebound, gathering 46bn while active equity funds saw outflows of 43bn.
UK equities represented an interesting example of open-ended funds-to-ETF rotation. In the context of Brexit, we observed very strong flows into UK equity ETFs ...................... To view our full article Click here
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