ETFs assets spike in June
A record number of new exchange traded funds were launched in the June quarter into the Australian market, with 14 launches, according to Morningstar's ETFInvestor report.
Assets in Australian exchange traded funds saw a 3.76 per cent spike in the June quarter to $18.29 billion, up from $17.62 billion at the end of March.
Morningstar noted that this was an impressive result at a time when global equity markets were flat and the S&P/ASX 200 Index was down 6.59 per cent.
Vanguard All-World ex-US Shares ETF's book saw a growth of $76.9 million to &517.7 million, while its newer hedged and unhedged MSCI World ETFs VGS and VGAD also grew by almost $40 million between the two.
However iShares MSCI Emerging Markets (AU) IEM fell by $127.8 million to $390.5 million, while iShares S&P/ASX Small Ordinaries ISO almost halved its book, falling from $60.4 million to $31.9 million.
The small-cap market was down 4.05 per cent, meaning most of the falls in assets were due to outflows.
"As ETFs grow in stature, more transactions are occurring between ETF investors, without underlying stocks necessarily being traded — the ownership of the underlying ETF portfolio merely changes hands," Morningstar research analyst Alex Prineas said.
"In some markets ETFs have even supplanted futures contracts as the major source of liquidity and index exposure."
AUTHOR
Malavika Santhebennur
Recommended for you
A former Brisbane financial adviser has been charged with 26 counts of dishonest conduct regarding a failure to disclose he would receive substantial commission payments for investments.
Inefficient data processes and systems mean advisers are spending over half of their time on product implementation and administration at the expense of clients, according to research.
With the regulator announcing its enforcement focus for 2025 last week, law firm Hall & Wilcox examines the areas which have dropped down the list in priority for the regulator.
South Australian financial advice and accounting business Perks has extended its paid parental leave program from 12 to 26 weeks, putting it on par with big four firms.
