The exchange traded fund industry came of age during 2015, with continued investor adoption resulting in a number of records broken for funds under management, net inflows, trading activity and number of products launched.
The industry recorded its highest ever annual growth in 2015, with funds under management increasing $6.4 billion (up 42% on 2014) to end the year at a new record high of $21 billion.
In a year when most stock markets remained flat, or even fell, the Australian exchange traded fund industry showed resilience by maintaining steady and consistent net inflows, with almost all (94%) of the growth coming from net inflows. This represents a record of $6 billion in new money, an increase of 40% on the net inflows of 2014 ($4.3 billion).
Market Size & Growth
- ASX Exchange Traded Funds Market Cap: $21.4B – new record high
- Market cap growth for year: 42%,+$6.4B
- New unit growth for year (units outstanding by number): 87%
- Net new money (units outstanding by $ value): +$6.0B
Comment: The pace of growth in the industry is exemplified by comparing net inflow growth between the exchange traded fund industry and the unlisted retail managed funds industry. Net inflow growth was 44% for exchange traded funds vs. 6.6% into retail managed funds.
- 169 Exchange Traded Products trading on the ASX
- New products: 69 new products launched in the year (vs. 12 in 2014), 1 product closed – record number of new products launched
Trading value increased 61% compared to 2014 – record trading year for exchange traded funds
Japanese equities and global sectors (consumer staples and health care), the best performing products over 2015
Top 5 category inflows (by $) – 2015
|Aus. Equities – Broad||$1,742,610,546|
|International Equities – Developed||$1,703,072,248|
|International Equities – Global||$735,808,764|
|Aus. High Yield||$570,709,073|
|Aus. Equities – Large Cap||$325,665,468|
Comment: Consistently, as with previous years, the vast majority of the industry’s net inflows were captured by the top 4 ranking issuers by net inflows, with iShares, Vanguard, State Street and BetaShares attracting 85% of the industry’s net flows.
Top category outflows (by $) – 2015
Comment: Strikingly, there were no outflows at a category level, with any outflows at a product level negated by inflows by other products in the same category
While 2015 was an impressive year of growth and opportunity for the Australian exchange traded fund industry, we believe 2016 has even more potential. We believe the industry will continue to grow strongly – and forecast total industry FuM at end 2016 to be in the range of $28-$30B
Stay with us to find out!
 Plan for Life, Inflows for 12 months to end of September Quarter 2015 – Retail Managed Funds Industry