In the first six months of 2024, four new issuers entered the local exchange-traded product (ETP) market, data from EY has revealed.
EY clarified that among the new issuers were Claremont and Investors Mutual Limited with listings on the ASX, alongside Lazard and Monochrome on Cboe.
Monochrome’s market introduction made a notable splash, with its CEO Jeff Yew asserting that his product is Australia’s first exchange-traded fund to hold bitcoin directly. As at 27 August, Monochrome Bitcoin ETF (IBTC) had $11.44 million in assets under management.
Also in the June quarter, Cboe Australia commenced the quotation of Lazard Asset Management’s first ETF – the Lazard Global Listed Infrastructure Active ETF (GIFL) – in Australia.
The launch, Cboe Australia’s president Emma Quinn said at the time, marked a major milestone in Cboe’s bid to drive competition in the market.
Moreover, in February, Claremont unveiled its Global Fund (Hedged) (Managed Fund) and Global Fund (Managed Fund) on the ASX.
However, despite the influx of new products, EY noted that the industry remains highly concentrated with the top three firms holding roughly 65 per cent market share as measured by funds under management. Moreover, it pointed out that these firms – Vanguard, Betashares and iShares – received 82.8 per cent of the net flows in the June quarter, which amounted to $5.2 billion.
Over the quarter, Vanguard held the largest ETP market share at 28.4 per cent – interestingly, the firm only accounted for 8.3 per cent of all 335 products on market.
Meanwhile, Betashares’ $37 billion FUM accounted for 18.6 per cent of the total market share but made up more than a quarter (25.4 per cent) of available products. While iShares’ products made up just 13.1 per cent of the market, the asset manager held a similar market share to Betashares, at 18 per cent.
The three months to 30 June was also a record breaker for active exchange-traded product launches, EY clarified. An impressive 14 out of the 19 products launched in 2Q24 were actively managed, while all four new entrants were also active ETF issuers.
2H24 kicks off with a bang
The local ETF market has already seen a flurry of new product launches since the commencement of FY2024–25.
Kicking off July, Global X ETFs announced the launch of its Global X FANG+ (Currency Hedged) ETF (ASX: FHNG), offering Australian investors exposure to companies at the forefront of “next-generation” technology with minimised exchange rate risk.
Shortly after this, the firm announced that the Global X Australian Bank Credit ETF (ASX: BANK), providing investors with exposure to credit in the Australian banking sector, would be made available on the ASX.
That same week, DigitalX confirmed the launch of its Bitcoin ETF (ASX: BTXX), saying it is the “only ASX-listed locally-domiciled ETF offering direct exposure to bitcoin”.
Over July, Betashares also added the Betashares Australian Momentum ETF (ASX: MTUM) and Betashares S&P 500 Equal Weight Currency Hedged ETF (ASX: HQUS) on the ASX, expanding its local product suite.
Meanwhile, State Street Global Advisors (SSGA) launched a High Growth investment offering for advisers seeking to service younger investors, and global firm JP Morgan Asset Management (JPMAM) listed its Global Equity Premium Income Complex ETF (JEGA) in Australia.
Rounding out August, Dimensional Fund Advisors, the world’s largest issuer of active ETFs, launched three component funds for local investors, while BlackRock unveiled the longest duration exposure available within its Australian listed iShares product range, the iShares 20+ Year US Treasury Bond ETF (AUD Hedged) (ULTB).
