March 13, 2018 11:30
The research firm Strategic Insight also confirms the enthusiasm for the ETF. In the first part of the year 2017, 67 new ETFS have been launched, which is a record for two consecutive quarters.
Benjamin Reed-Hurwitz, associate consultant and senior analyst, and Megan Cobb, analyst and expert in exchange-traded funds, have granted an interview to the Journal of insurance about it. Ms. Cobb pointed out that six new suppliers have emerged in the market during this period. “This is more than in any other full year,” she said.
There were 24 sponsors of ETFS in Canada on July 31, 2017, or seven more than a year ago, said Megan Cobb. There were 514 ETF different to this date, or 86 more than a year ago, she recalled, according to the data that provides Strategic Insight to the Canadian ETF Association (CETFA), through its department ETF Insights. CETFA is and monthly and quarterly reports on the ETFS, in which Ms. Cobb is a regular contributor.
30 ETF launched in September : another record
According to the bulletin, the Canadian ETF Flows of National Bank Financial, 30 ETFS have been launched for the single month of September. Another record. This is now the total number of ETFS in Canada to 600. The number of suppliers is increased to 28, date February 28, 2018.
“The assets of the ETFS is growing very rapidly, at double the rate of growth of the active mutual funds. In July 2017, the exchange-traded funds accounted for in Canada an asset of 130,5 billion dollars (G$), or 23.3 % more than a year ago. Between June 2016 and June 2017, the growth of exchange traded funds was at its peak, showing a growth of 27 %, ” revealed Ms. Cobb. In the month of August, the assets of the ETF was to 133,9 G$, according to data from Strategic Insight.
19.4 G$ of assets in mutual funds
As reference, the specialist of the ETF reports that the assets of mutual funds accounted for 19.4 G$ in December 2008. In 10 years, the annual growth of the assets has averaged 22.9 %.
“The growth rate of the ETF is greatly accelerated in the last few years. Their assets increased month after month since a very good time. The stock markets have not performed well in July, which led to a slight decline. Growth will resume quickly. It will continue in the next years, ” says Ms. Cobb.
The growth of the mutual fund remains the best
However, 133,9 G$ still appear little in comparison to the assets of a trillion and a half dollars (1 500$) funds, a mutual fund, however, indicated the two analysts.
“The ETFS remain a small portion of the entire universe of canadian investment funds, compared to mutual funds. The rapid growth of their assets shows that ETFS still have room to grow. This is not to say that they’ll catch up the assets of the common fund, and still less that they will replace them, ” observes his side Mr. Reed-Hurwitz.
The growth reflects, according to him, both the increase of the demand of the market of individual investors to the ETFS that from far away. “The ETF start from a base much smaller than that of mutual funds. Sales absolute growth of mutual funds is much bigger, ” he says.
According to the two analysts, the share of the assets of the ETF held by the institutional market is 35% and that of the individual market to 65 %. “It has not changed much since we follow the evolution of this market. The active ETFS will continue to grow. It is difficult to say what proportion additional will collect the individual market, ” said Megan Cobb.