Europe Monthly ETF Market Review; Deutsche Bank Markets Research
Data as at: 30.11.2015 Global ETP sector again records net inflows in November
Global ETP Market In and Outflows:
• The global ETP industry continued to grow during November. After net inflows totaling US dollar 34 billion in October, the November figure was a further US dollar 25.7 billion. As such, the industry now manages US Dollar 2.9 trillion. (p. 1, 23)
• As in the previous month, the American ETP sector was the driver of this growth. It contributed US dollar 26 billion to global growth. Since the start of the year US ETPs have secured virtually US dollar 200 billion. In keeping with the previous month, inflows from Equity ETFs dominated with US dollar 25 billion.
• The trend for Bond ETFs turned negative in November. In contrast to worldwide inflows of US dollar 14.5 billion for this segment in October, during the month just past investors withdrew US dollar 47 million. (p. 23)
• Inflows also declined for Commodities ETCs. After a plus of US dollar 789 million in October, the past month saw a minus of US dollar 153 million. (p. 23)
• In parallel with the American ETP sector, the European ETF sector continued to grow during November. Following net inflows of US dollar 6.9 billion for October, the sector secured US dollar 3.4 billion in November. Equity ETF inflows also dominated in this case. (p. 23)
• Conversely, Asian ETPs saw a continuation of the negative trend of the previous month. Investors withdrew US dollar 3.7 billion. Equity ETFs were particularly affected with outflows running to US dollar 3 billion. In fact, Bond ETFs also recorded a decline. (p. 23).
European ETF Market In and Outflows
Equities
• The positive trend for European ETFs continued during November. In total, the sector recorded net inflows of Euro 3.1 billion, compared with October’s Euro 5.9 billion. This was primarily due to Bond ETFs with net inflows of Euro 515 million which was significantly lower than the previous month (+ Euro 3.5 billion). At the same time, net inflows for Equity ETFs at Euro 2.5 billion were slightly higher than in October (+ Euro 2.4 billion). (p. 23)
• ETFs on US Equities were particularly in demand with European investors. With net inflows of Euro 637 million, US Equities accounted for one quarter of positive Equity ETF cash flows, followed by Global Indices (+ Euro 436 million) and Japanese Equities (+ Euro 387 million). This marked a trend change for US Equities after investors withdrew capital totaling Euro 227 million from this segment in October. Net inflows recorded by ETFs on European Equities fell to Euro 54 million after Euro 1.1 billion the previous month. (p. 25)
• Since the start of the year, cumulative net inflows recorded by ETFs on broadly-based European Equity Indices total Euro 20.3 billion, although during November the trend showed a slight change with investors withdrawing Euro 279 million from this segment. (p. 25)
• The positive shift in ETFs on Emerging Markets continued in November. This segment recorded a further Euro 6 million following Euro 824 million in October. Since the start of the year however, Emerging Markets ETFs have registered total outflows of Euro 1.9 billion. (p. 26)
• Having said that, during November inflows for ETFs on large Emerging Markets declined, in particular India ETFs where investors withdrew Euro 225 million. Positive inflows were recorded by ETFs on international Emerging Markets Indices. (p. 26)
• Strategy ETFs achieved a turnaround in November again registering inflows of Euro 178 million, after October’s outflows of Euro 481 million. (p. 24)
Bonds
• The positive trend for Bond ETFs also progressed in November, although net inflows of Euro 0.5 billion were significantly lower than the October figure (+ Euro 3.5 billion). (p. 26)
• In this arena, ETFs on Corporate Bonds accounted for the highest inflows with Euro 1.7 billion. This exceeded the October inflows figure. From an annual viewpoint, Corporate Bonds have registered net inflows amounting to Euro 13.1 billion. (p. 26)
• The positive trend over recent months for Sovereign Bonds has come to an end for the time being. Investors withdrew Euro 1.3 billion from this segment. (p. 26)
Commodities
• European Commodities ETPs registered Euro 166 million in November after Euro 340 million during October. (p. 27)
•While ETFs on Industrial Metals did once again generate slightly positive cash flows, ETFs on Precious Metals shed Euro 167 million contrasted with October when this segment had made a positive contribution to inflows. (p. 27)
Most Popular Indices
• In November, investors showed interest in Real Estate and Dividend ETFs. As such, ETFs on Real Estate Equity Indices in particular came high up the lists. (p. 28)
• The most popular Equity Indices in November were the S&P 500, the Euro STOXX 50 as well as the Stoxx 600. (p. 28)
• In the Bond arena, ETFs on Corporate Bond Indices in particular proved to be some of the most popular indices. (p. 28)
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