BetaShares Australian ETF Review | November 2018 | BetaShares Insights

BetaShares Australian ETF Review – November 2018

BY Ilan Israelstam | 12 December 2018
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ETF Review - November 2018

Industry ekes out gains in another tough month in equities 

Notwithstanding continued market volatility and sharemarket declines, the ETF industry returned to its growth trajectory after last month’s declines, ending the month at $41.1B in assets. The industry’s total market cap grew by 0.8% (+$320m), which was entirely driven by net inflows rather than asset appreciation. Read on for details of the month in ETFs.

Market Cap

  • ASX Exchange Traded Funds Market Cap: $41.1B
  • Market cap increase for month: 0.8%, +$320M
  • Market cap growth for the last 12 months: 16%, + $5.6B

New Money

  • New unit growth for month (units outstanding by number): $1.4B
  • Net new money for month (units outstanding by $ value): +$573.6M

Comment: Net flows into the industry continued to be positive, amounting to $574m. This more than offsetted asset value declines experienced due to falling sharemarkets.

 Products

  • 247 Exchange Traded Products trading on the ASX – 10 new products launched on the ASX

Comment: As we have been predicting throughout the year, ETF product development continues to be strong in the second half of the year, with 10 new products launched on the ASX this month, including the first bond Active ETF (BetaShares Legg Mason Australian Bond Fund (managed fund) (ASX: BNDS). 

Trading value

  • Trading value declined 10% for the month after last month’s all time high trading value.

Performance

 

Top 5 Category Inflows (by $) – November 2018

Category Inflow Value
International Equities $242,720,347
Fixed Income $188,761,742
Australian Equities $137,465,727
Multi-Asset $26,471,750
Australian Listed Property $11,822,767

Comment: International equities were once again the category with highest flows (after Australian equities briefly took the mantle last month), although continued investor uncertainty regarding equities actually caused Australian Bond exposures to be the largest sub-category for flows this month – with total flows of $180m.

Top Category Outflows (by $) – November 2018

Category Outflow Value
Short ($27,457,715)
Currency ($15,837,105)

Comment: Net outflows at a category level were limited and appeared to be the result of investor profit taking – with investors selling out of Short exposures which rallied as the market declined, as well as continued selling in U.S. Dollar ETFs (even though the AUD staged a short-lived comeback in November).

Top Sub-Category Inflows (by $) – November 2018

Category Inflow Value
Australian Bonds $179,212,160
International Equities – Developed World $164,337,318
Australian Equities – Broad $69,356,952
International Equities – US $31,667,333
nternational Equities – Sector $31,434,114

Top Sub-Category Outflows (by $) – November 2018

Category  Outflow Value
Currency ($15,837,105)
Australian Equities – Short ($14,450,315)
US Equities – Short ($13,007,400)
International Equities – Asia ($12,590,918)
Australian Equities – Large Cap ($1,323,273)