ETFs see 150% turnover growth in March
Exchange traded funds (ETFs) trading volumes hit an all-time high of $18 billion in turnover in March, more than double its previous record, according to BetaShares.
ETF trades on the Australian Securities Exchange (ASX) were $18 billion during March, beating the record held in February which was $7.2 billion.
This growth came despite funds under management declining by $6.8 billion in line with falling equity markets, with the sector ending the month with funds under management of $57.2 billion. This equated to net positive inflows of $522 million.
The most popular vehicles were broad Australian equities products which received $1.1 billion in net inflows while fixed income and cash vehicles were sold down. Hedged international products also saw positive flows, reflecting the weakness in the Australian dollar.
BetaShares said its Australian Equities Strong Bear Hedge fund, a fund that seeks to generate returns which are negatively correlated with the Australian stockmarket, accounted for $2 billion of monthly trading value and was one of the strongest-performing funds during the month.
BetaShares chief executive, Alex Vynokur, said: “During this challenging period, the extraordinary rise in ETF trading volumes indicates that Australian investors are increasingly turning to ETFs to express their investment views, suggesting that the liquidity of ETFs is proving attractive amidst some of the most intense volatility in recent history.”
AUTHOR
Laura Dew
Recommended for you
Lonsec and SQM Research have highlighted manager selection as a crucial risk for financial advisers when it comes to private market investments, particularly due to the clear performance dispersion.
Macquarie Asset Management has indicated its desire to commit the fast-growing wealth business in Australia by divesting part of its public investment business to Japanese investment bank Nomura.
Australia’s “sophisticated” financial services industry is a magnet for offshore fund managers, according to a global firm.
The latest Morningstar asset manager survey believes ETF providers are likely to retain the market share they have gained from active managers.
