The global exchange traded products (ETPs) industry saw $262.7 billion in net inflows through 2012, just eclipsing the $259.7 billion that rolled in during 2008.
Figures from BlackRock’s monthly ETP Landscape report show BlackRock’s iShares saw the biggest slice of net flows, with $85.3 billion, or just under one third of total flows. A breakdown of other providers was not available.
By region, the greatest growth was seen in the United States which accounted for three quarters of iShares inflows and 71 per cent of global net flows.
The Asia Pacific region had the highest asset growth rate of any region at 37 per cent for 2012, with a record $30.6 billion in annual flows, the report found.
Canada saw the second highest growth rate, with the ETP market there swelling by 33 per cent in 2012, with $12.0 billion in inflows. The United States also attracted record-breaking flows of $187.4 billion for the year, leaving Europe and Latin America as the only regions not to set new annual records for net new business.
While equities were still the preferred asset class, commanding just over two thirds of inflows, there was a greater bias towards emerging markets equities, and the appeal of fixed income products also increased.
Fixed income ETPs saw 40 per cent greater flows, up to $70 billion, but emerging markets products saw a more than five-fold increase – up from $9.7 billion in 2011 to $54.8 billion in 2012.
iShares said its global assets under management reached $758.6 billion as of 31 December 2012.
“ETPs are attracting a broader base of global investors than ever before, driven by regional regulatory developments, deepening ETP liquidity, and increasing awareness among both retail and institutional clients of the benefits of ETPs,” the report stated.
Jane Leung, head of iShares Asia Pacific, said Asian investors are expected to continue to seek income and yield in different places, driving growth in fixed income products.
“Investment access to China through ETFs [exchange traded funds] is also likely to develop as investors become more specific in their exposures, targeting those sectors that they believe will outperform in the long run. We expect assets under management and trading volumes in ETFs to grow significantly in Asia Pacific as a result,” Ms Leung said.
