European ETF industry flourishes in 2017 with 40% AUM growth

Jan 10th, 2018 | By | Category: ETF and Index News

European-listed ETFs enjoyed a record-breaking increase in assets of $230 billion during 2017 to reach $802bn at year end, according to data from ETFGI.

European ETF industry flourishes in 2017 with 40% AUM growth

Hector McNeil, co-CEO of white-label ETF provider HANetf.

The surge in assets is more than triple the previous record annual increase of assets – $67bn in 2016.

The increase of 40%, from $573bn at the end of 2016, is the most significant growth in European ETF assets since 2009 when markets recovered following the 2008 financial crisis. It is also significantly higher than the ten-year compound annual growth rate for the industry of 19.3%.

Commenting on the surge in assets over the past year, Hector McNeil, co-CEO of newly launched white-label ETF platform HANetf, said: “ETFs are a success story that no asset manager can afford to ignore and I predict double-digit asset growth in ETFs is the new normal.

“Many asset managers are now realising the powerful distribution potential of the ETF wrapper for their IP and looking for the best way to get started. This is why I set up HANetf with my partner, Nik Bienkowski – to smash down barriers to entry, making it easier, cheaper and faster for companies to launch ETFs so they and their clients can benefit from this massive growth opportunity.”

Whilst December 2017 marked the thirty-eighth consecutive month of net inflows into European-listed ETFs, flows were relatively subdued with just $1.6bn gathered during the month. Equity ETFs experienced net inflows of $4.3bn in December, growing net inflows for 2017 to $70.7bn.

Over the whole year, ETFs listed in Europe saw total net inflows of $108.3bn – 94% more than net inflows for 2016 and over double the average for net inflows over the previous five years. Upwards-trending markets through the year contributed a further $121.5bn to the annual growth of the European ETF industry.

Almost a third (31%) of net inflows recorded for the year can be attributed to the top 20 ETFs by net new assets, which collectively amassed $33.6bn during 2017. The iShares JP Morgan EM Local Govt Bond UCITS ETF (SEML LN) was the most successful gatherer of net new assets, accounting for net inflows of $2.9bn.

ETFGI Net Inflows Europe Graph 2

Source: ETFGI.

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