ETFs – The last 15 years

Tuesday 4th June 2019 Penny Pryor

The number of listed products on the Australian Stock Exchange continues to grow, with two more being added in May. The ASX says there are now 194 exchange traded products listed on the ASX with $47.66 billion in funds under management.

But it hasn’t always been this way. Although the first ETF was listed on the ASX in August 2001 – the SPDR S&P/ASX 200 FUND – the below table shows that the take up was slow, with just 10 listed in December 2002 and that number dropping back to 7 in 2004. Market cap at that point was just $706.6 million.

ETF Last 12 months

In the 15 years since then, market cap has grown exponentially and 12-month average transactions now number 106,833 with 12-month average value at $3.1 billion – a far cry from the numbers above.

There are now 23 issuers of the 194 exchange traded products on the ASX, with the majority of funds under management in global equity ETFs. This highlights the trend of local investors using global ETFs as a means to gain diversified international equity exposure at a low cost.

ASX Investment Prouct Summary

Fixed income is also becoming another popular asset class for ETFs as they offer diversified access to an asset class that is hard for a retail investor to access without large amounts of capital. Fixed income ETFs have only been available on the ASX since 2012.

ETFs are likely to continue to offer the retail investor a low-cost method of accessing a wide variety of investment management capabilities and fund managers another avenue to access inflows.

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