A view of the estimated net sales of exchange traded funds (ETFs) shows that the industry has enjoyed very strong estimated net inflows (+$1.229.3 bn) over the course of the first 10 months of 2024. Obviously, estimated net inflows of more than $1.2 bn are a big number on their own, but putting this into perspective, the inflows into ETFs globally nearly equal the assets under management held in ETFs in Ireland ($1.575,2 bn), the second largest ETF domicile in the world at the end of December.
That said, based on preliminary numbers, the assets under management in the global ETF industry grew by $2,004.4 bn over the course of 2024 so far. This means that 61.33% of the estimated growth of the industry can be attributed to the estimated net inflows, while only 38.67% ($775.1 bn) can be attributed to the performance of the underlying markets.
With regard to these strong inflows, it can be concluded that the global ETF industry is in a gold rush with regard to rising earnings caused by the rising assets under management.
Chart 1: Estimated Net Flows and Assets Under Management in the Global ETF Industry (in billion USD)
Source: LSEG Lipper
But even if the trend toward ETFs is a global phenomenon, not all regions or promoters are benefitting from this trend, as the estimated net flows are highly concentrated on different levels. One example of this is the estimated net flows at the domicile level, as the largest ETF domicile in the world, the U.S. (+844.5 bn), accounts for 68.72% of the overall estimated net inflows, while the second largest domicile, Ireland (+$169.6bn) accounts for 13.80%.
The same is somewhat true at the promoter level, as the five largest ETF promoters globally enjoyed cumulated estimated net inflows of $718.9 bn. Overall, only 81 ETF promoters enjoyed estimated net inflows of more than $1.0 bn, accounting for $1,212.0 bn in total.
With regard to this, it can be concluded that not all ETF promoters take profit from the current trend toward ETFs around the globe and might even been disappointed about their flow pattern in this positive market environment.
This article is for information purposes only and does not constitute any investment advice.
The views expressed are the views of the author, not necessarily those of LSEG Lipper or LSEG.
