Rather than simply using ETFs for core exposures, advisers are now using them at a more granular or ‘thematic’ level, said Mr Howie, who is a director and iShares specialist at BlackRock.
“[ETFs are being used] as a rapid access tool for dynamic asset allocation; blended together with stocks, other ETFs and with active funds to deliver a robust portfolio outcome for clients and to reinforce the advisers’ value proposition,” he said.
“A benefit of including ETFs in a wider portfolio today is that advisers are able to truly express a broader range of views for their clients,” he added.
Over $1.4 billion in new client money has flowed into ASX-listed ETFs for the 2013 year to date, which is more than for any previous full calendar year.
When it comes to asset classes, flows this year are revealing a preference for international equity ETFs, said Mr Howie.
“Advisers and their clients [are recognising] that investment opportunities are truly global,” he said.
In fact, international equities accounted for 57 per cent of new client money – and Australian equity income ETFs accounted for 24 per cent of money flows.
“With greater understanding of the opportunities that ETFs present as part of the broader investment toolkit, we expect to see greater use of ETFs to complement active funds and individual stocks as investors build more efficient and flexible portfolios,” Mr Howie said.
