Australian ETF industry sees two new funds launch in May

Jun 20th, 2017 | By | Category: ETF and Index News

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The Australian ETF industry welcomed two new funds during May, the VanEck Vectors Australian Corporate Bond Plus ETF (ASX: PLUS) and the UBS IQ Cash ETF (ASX: MONY), according to BetaShares’ monthly Australian ETF review.

Australian ETF industry sees two new funds launch in May

The Australian ETF industry had $29.0bn in AUM as of the end of May.

PLUS, through tracking the Markit iBoxx AUD Corporates Yield Plus Index, invests in a diversified portfolio of the highest yielding Australian dollar-denominated bonds with a minimum investment grade credit rating. The bonds are primarily issued by corporations including Australia’s four big banks, offshore banks, other lending institutions and overseas government organisations. It has a management expense ratio (MER) of 0.32%.

MONY is actively managed and seeks to provide exposure to Australian cash with regular income at competitive rates, combined with capital stability. The fund aims to provide returns which exceed the Reserve Bank of Australia Official Cash Rate before fees, expenses and taxes. Its MER is 0.18%.

The Australian ETF industry recorded another strong month of growth, with total industry AUM at the end of May hitting a new high of $29.0 billion. Total industry AUM growth during the month was 2.6% or $730m. BetaShares notes that in a month where the Australian market tumbled, almost all the growth came from net new money (658m), rather than asset appreciation. Market cap growth for last twelve months as of the end of May was 25.1% or $5.8bn.

The top five category inflows (by $) for May 2017 were into Australian equities ($329m), international equities ($202m), fixed income ($69m), commodities ($39m) and Australian listed property ($23m).

Average trading value was up 44% to be the second largest trading month on record (first largest set in February 2017).

As of the end of the month there were 206 ETPs trading on the ASX.

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