BlackRock’s iShares business led the global exchange-traded product (ETP) industry in 2012 by capturing $85.3 billion in new flows. Growth was led by its US product line, which added a record $61.0 billion of new assets.
With $758.6 billion in assets, BlackRock’s iShares business is the world’s largest provider of ETPs.
The business also performed strongly in Canada and in Europe, where it captured $18.3 billion in net new flows, equivalent to 56% of all new money entering European ETPs.
With $758.6 billion in assets under management (as of 31 December 2012) and a market share of 39%, iShares is the largest ETP provider globally. Second place goes to SSgA’s SPDR business with $337 billion in assets and 17% market share, followed by Vanguard with $246 billion and 13% market share.
These top three providers account for $1.34 trillion or 69% of global ETP assets.
Mark Wiedman, Global Head of iShares, said: “iShares continues to be the go-to product for all types of investors – from capital market participants looking for deep liquidity, to investors seeking specialised exposures, to a growing segment of the market using ETFs as buy and hold investment vehicles.”
ETPs are attracting a broader base of global investors than ever before, driven by regional regulatory developments (such as RDR in the UK), deepening ETP liquidity, and increasing awareness among both retail and institutional clients of the benefits of ETPs. These efficient tools can be used for strategic and tactical asset allocation, access to niche exposures and sectors, cash deployment, and risk management and hedging.
According to Deborah Fuhr, Managing Partner at ETFGI, a London-based ETP consultancy: “The uncertain and challenging market conditions investors have faced during 2012 and over the past few years, combined with the difficulty in finding active managers that consistently deliver alpha, have caused more institutional investors, financial advisors and retail investors to embrace the use of ETFs and ETPs for strategic and tactical asset allocations.”
She added: “ETFs provide greater transparency in relation to costs, portfolio holdings, price, liquidity, product structure, risk and return compared to many other investment products and mutual funds.”