BetaShares Australian ETF Review - February 2020 | BetaShares

BetaShares Australian ETF Review – February 2020

BY Ilan Israelstam | 18 March 2020
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Aus ETF Review - February 2020

Reading time: 3 minutes

ETF INDUSTRY CATCHES A COLD…AND TRADES UP A STORM

After 14 straight months of growth, the Australian ETF industry encountered a rare month of negative growth in February. After starting the year with a bang, industry FuM fell by $2.0B (-3.1% MoM decline) to end February at $64.0B. Read on for more details.

Australian ETP Market Cap: August 2001 – February 2020

Australian ETP Market Cap: July 2001 - February 2020

CAGR: Compound Annual Growth Rate
Source: ASX, Chi-X, BetaShares

Market cap

  • ASX Exchange Traded Product Market Cap: $64.0B 
  • Market cap increase for month: -3.1%, -$2.0B – first monthly decrease in 14 months
  • Market cap growth for the last 12 months: 43%, + $19.2B

Comment: Net inflows into the industry were not enough to counter the dramatic drops in equity prices resulting in our first monthly decrease in 14 months. Importantly, notwithstanding tremendous volatility, all ETFs in the industry performed as expected, which will provide a ‘real life’ case study for those observers who had previously felt that ETFs had not been tested in rapidly falling markets.

New money

  • Unit growth for month (units outstanding by number): +2.5%
  • Net new money for month (units outstanding by % value): +$1.6B 

Comment: Notably, $ inflows into the industry remained positive at $1.6B with the industry’s fall entirely attributable to asset value declines as markets tumbled in the last week of the month.

Products

  • 255 Exchange Traded Products trading on the ASX and Chi-X – 1 new product launched this month.

Trading value

  • ASX ETF trading value increased 42% to reach an all-time record month of trading – $7.2B

Comment: Perhaps the most striking statistic this month was trading values which reached all time monthly highs, growing 42% MoM and >$7B traded on ASX-quoted ETFs for the first time. This large increase in trading mirrors what we saw globally – with investors seeking out the liquidity of ETFs during volatile times to express both bullish and bearish views.

Performance

Comment: Given their negatively correlated objectives, each rallied >20% for the month as equity markets fell.

Top 5 category inflows (by $) – February

Category                                                  Inflow Value
International Equities $935,433,158
Fixed Income $306,359,541
Commodities $176,865,128
Cash $122,328,315
Australian Equities $86,849,945

Comment: For the second month in a row, it was still global equities products that received the largest levels of inflows ($935m) with fixed income coming in second place this month ($306m). Broad Australian and Asian Equities products were sold off with investors seemingly viewing the US market as more able to weather the current economic storm.

Top category outflows (by $) – February

Sub-Category   Inflow Value
Multi-Asset ($11,406,238)
Currency ($7,220,055)

Top sub-category inflows (by $) – February

Sub-Category   Inflow Value
International Equities – US $330,783,147
International Equities – Developed World $330,417,092
Australian Bonds $183,608,087
Gold $159,011,816
Australian Equities – Ethical $136,559,893

Top sub-category outflows (by $) – February

Category                                                  Inflow Value
Australian Equities – Broad ($46,526,022)
International Equities – Asia ($31,541,224)
Australian Equities – Resource Sector ($15,654,260)
Multi-Asset ($11,406,238)
Currency ($7,220,055)

 

2 Comments

  1. Wayne Sanderson  |  April 15, 2020

    The March report should be really interesting. Thank you.

    1. Benjamin Smith  |  April 16, 2020

      Hi Wayne,

      Thanks for reaching out.

      We’ve recently released the March 2020 ETF Review- you can find it via the following link: https://www.betashares.com.au/insights/betashares-australian-etf-review-march-2020/.

      Sincerely,

      BetaShares Client Services

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