Shares of exchange traded fund provider WisdomTree Investments (NasdaqGM: WETF) fell nearly 10% on Monday after the firm announced fourth-quarter financial results.
WisdomTree said ETF assets under management rose by 23.2% from the year-ago period to $12.2 billion, although inflows fell to $756 million from $1.3 billion.
“Despite positive market movement and net inflows experienced in the fourth quarter, total revenues decreased 8.8% compared to the third quarter of 2011 primarily due to a 7.3% decline in our average assets under management,” the company said. “This average AUM decline in the fourth quarter resulted from $1.9 billion of negative market movement and outflows from our emerging market currency and fixed income ETFs in the third quarter.”
WisdomTree CEO Jonathan Steinberg in the earnings release said the company ended 2011 with $3.9 billion in net inflows, a record. Also, the company turned profitable, listed its shares on the Nasdaq and launched two of the most successful new ETFs of the year.
“The larger ETF industry growth story remains intact,” Steinberg noted. “ETF assets under management still only represents about 11% of the combined ETF and mutual fund market. Yet over the last five years ETFs have taken in 50% of total net inflows. 2011 was another strong year with ETFs taking $115 billion versus $32 billion for mutual funds, or 78% of total inflows.”