While exact numbers differ, three data providers agree that the estimated assets under management in exchange-traded funds (ETFs) and similar exchange-traded products (ETPs) surpassed $4trn at the end of May. Blackrock estimates the AUM at $4.04trn, ETFGI at $4.1trn ($3.94 trn in ETFs), and FSA‘s estimate based on Morningstar data is $4.09trn.
The milestone is not a surprise, as the assets in ETFs/ETPs have been growing relentlessly over the last decade, surpassing $1trn in 2009, $2trn in 2013 and $3trn in March 2016.
In May, broad European equity ETFs had the biggest inflows. Investors also bought into Asian and emerging market equities as well as investment grade corporate debt.
The biggest outflows were from US small cap ETFs.
The growth in passive product AUM is driven chiefly by the largest ETF market, the US. The products domiciled there account for $2.9tr AUM, or 71% of the market.
With $344bn of AUM, Asia accounts for 8.3% of the ETF/ETP market globally, according to data from Morningstar.
ETFs domiciled in Japan have been growing fastest, supported by purchases by the Bank of Japan as part of its quantitative easing programme. They now make up the largest share of AUM in the region with $211bn of assets.
In China, about half of passive product AUM is attributed to money market ETFs.
AUM by domicile
Data: Morningstar, as of 31 May, in US dollars
Globally, Blackrock is ranked first with $1.5tr of AUM in its iShares ETFs.
In Asia, Japanese banks take the top four spots, led by Nomura and followed by Hong Kong’s Hang Seng, Korea’s Samsung, Taiwan’s Yuanta Financial and three Chinese firms.
| Top 10 Global ETF Providers | Total Net Assets (billions US dollars) | Top 10 Asian ETF Providers | Total Net Assets (billions US dollars) |
| iShares | 1,518.4 | Nomura | 98.1 |
| Vanguard | 765.5 | Nikko AM | 45.8 |
| State Street | 563.8 | Daiwa | 43.3 |
| PowerShares | 127.1 | Mitsubishi UFJ | 18.4 |
| Nomura | 98.2 | Hang Seng | 12.0 |
| Schwab | 75.9 | Samsung | 11.1 |
| Lyxor | 66.9 | Fortune SGAM | 11.0 |
| db X-trackers | 66.6 | China AMC | 9.6 |
| UBS | 49.6 | Yuanta Financial | 6.9 |
| First Trust | 48.2 | E Fund Management | 6.4 |
Data: Morningstar, as of 31 May 2017
ETFGI defines ETFs as open-end index funds with a mutual fund structure and a unique creation/redemption process, whose units trade on an exchange. ETPs use other structures such as grantor trusts, partnerships, structured products and despositary receipts. ETPs account for 27% of the listed ETPs/ETFs, but only 4% of their assets under management, according to ETFGI.
ETF asset classes
Globally, equity ETFs constitute the largest asset class at 77% of AUM. In Asia, the preference is even more pronounced, with fully 92% of passive products investing in equities. Again, the proportion is skewed by Japan, where equity ETFs account for 97% of AUM.
Data: Morningstar, as of 31 May, in US dollars
