ETFs and Index Funds Are Growing Like Weeds

Exchange traded fund (ETF) usage was recently explored by the Advisor Perspectives Universe.

The data, gathered on Feb. 28, was interesting:

• ETFs now hold twice the assets of
  index funds (70.3% vs. 29.7%).  ETF assets increased from 65.0% to
  70.3% over the prior five months.            

• ETFs and Index Funds now represent 32.9% of total mutual fund assets, up from 29% on Sept. 30, 2007 and 27% on June 30, 2007.

• ETFs
  and Index Funds now represent 6.4% of total marketable securities in
  the AP Universe, up from 4.6% on Sept. 30, 2007 and 3.9% on June 30, 2007.

• Holdings
  tied to broad-based indexes increased, but still represent a relatively
  small portion of overall assets in the AP Universe. Holdings tied to
  the S&P 500 increased from 17.3% to 24.5% of total mutual fund
  assets from Sept. 30, 2007 to Feb. 28. Holdings tied to the EFA increased
  from 17.5% to 20.4% over the same time period. Holdings tied to the
  total market decreased slightly, from 4.5% to 4.3%.

• Holdings
  in sector-based ETFs decreased consistently from Sept. 30, 2007 to Feb. 28 (as
  a percentage of mutual fund assets) and continue to remain a small
  percentage of ETF holdings.

For more interesting numbers and insight, check out the tables on the site.