ETF Sales Triple to Record High

The European exchange-traded fund market has got off to a stellar star in 2017, with record-high net inflows of €33.4 billion in the first quarter

Jose Garcia Zarate 20 April, 2017 | 11:51AM
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The European exchange-traded fund market has got off to a stellar star in 2017, with record-high net inflows of €33.4 billion in the first quarter, tripling the €11.1 billion registered in the closing three months of 2016. Assets under management at the end of the first quarter amounted to €601 billion, and were up 10.2% from €545.7 billion at the end of 2016.

US and European Equities Prove Popular

Equity ETFs were strongly favoured with €19.4 billion of net inflows. The distribution of quarterly net inflows by Morningstar Categories reveals that investors’ attitudes towards the global economy have improved considerably. In the top five money-gathering equity categories of the quarter we find a broad palette of exposures covering both developed and emerging markets.

Investors were happy to look through the political shenanigans of the newly installed Donald Trump administration and remain focused on the benefits of the promised fiscal policy-led expansion for the US economy. ETFs in the US large-cap blend equity category attracted close to €2.6 billion, while currency-hedged US equity ETFs netted in close to €1 billion.  The latter signalled how divergent monetary policy cycles in the US and Europe are adding a rising FX risk to the investment decision process.

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About Author

Jose Garcia Zarate

Jose Garcia Zarate  is Associate Director of Passive Strategies Research for Morningstar Europe