The National Stock Exchange reports that the total number of assets in U.S.-listed ETFs and exchange traded notes (ETNs) rose about 44% from October 2008. The number of assets in ETFs totaled $707.4 billion at the end of the month.

Net cash flows for from all ETFs and ETNs totaled more than $72 billion. There are about 808 exchange traded products listed to date, and of those, 401 have assets of more than $1 million. Apparently, investors are not spooked by the market climate as much as once thought. (Our October ETF performance report is here).

For more stories about ETF performance, visit our ETF performance reports category.

The Dow Jones Industrial Average finally crossed a milestone 10,000 points this month. Though the mark was greeted with cheers on the trading floor, it didn’t stay there for long, and ultimately closed the month below 10,000 and ended the month flat. The S&P 500 lost 2% and the Nasdaq fell 3.6%.

October was largely a month that saw a weakening dollar. This was to the benefit of commodity ETFs, including SPDR Gold Shares (NYSE: GLD), which gained 3.7% for the month. United States Oil (NYSEArca: USO) gained 8.6%.

Earnings season was a largely encouraging one. The number of better-than-expected reports outnumbered the worse-than-expected ones by a ratio of about 6:1. But there are still big concerns about consumers: spending dropped 0.5% in September. As long as consumers aren’t spending, the recovery could be long and difficult.

To view our full performance report, click here.

For full disclosure, Tom Lydon’s clients own shares of GLD.

Barclays Wealth is offering a program that uses active managers who allocate clients’ money into a variety of passive index-based ETFs, writes Aaron Pressman for Reuters. By using ETFs, participants are able to use an investment vehicle that has better diversification and greater liquidity. (Mutual funds want in on ETFs). So far, Barclays is one of the largest firms to offer such a program, but there are others introducing them at a fast rate.

The proliferation of ETFs, along with the poor performance of high-priced money managers of last year, has many investors turning to the simpler yet diversified investment product. According to research firm HedgeFund.net, investors pulled $800 billion out of hedge funds and similar investments between July 1, 2008 and June 30, 2009.

ETFs may not be a magic bullet, though. Some investors may be disappointed if the firms’ asset allocation models don’t work as expected, and the programs may have to fight for assets if wealthy clients continue to gravitate toward private money managers. (How ETFs will overtake mutual funds).

For brokers, it was exciting to be able to present hedge fund opportunities to clients, but in most cases, it brought pains instead of gains. Today, investors are looking for transparency, low fees and tax efficiency. They don’t want surprises. ETFs give them what they’re looking for. The big question now is how will brokers justify their large fees?

For more information on fund providers, visit our mutual funds category.

Max Chen contributed to this article.

By the end of September, U.S.-listed ETF assets hit an all-time high of $607 billion. There are 710 U.S. listed ETFs to choose from, and of the total, 54 were added last month.

Total year-to-date assets are up 22.1% from one year ago, while mutual fund assets have declined by $50.8 billion. The total number of de-listed U.S. ETFs year-to-date is at 42.

As the health of the ETF industry is restored, the leveraged and inverse U.S. listed ETFs have also regained their momentum. Joe Morris for Ignites reports that leveraged and inverse ETF assets rose to $29.3 billion, up 1.9% for the month.

For more stories about ETF assets, visit our ETF 101 category.

For the month, the Dow Jones Industrial Average gained 2.3%. The S&P 500 rose 3.6%, while the Nasdaq gained 5.6%. For the quarter, the Dow gained 14.2%, the S&P increased 14.5% and the Nasdaq added 15%.

The last time the Dow saw such a large quarterly surge was back in the fourth quarter of 1998, when it rose 17.2% as the dot-com bubble was forming.

A number of measures were enacted this quarter that helped spur the rally. Positive statements about the recession likely being over from Federal Reserve Chairman Ben Bernanke contributed some optimism. The popular “cash for clunkers” program helped spur auto sales and managed to get ordinarily tight-fisted consumers to open their wallets.

Gold prices have also gained, surging above the $1,000 an ounce mark on a combination of safe-haven seeking, hedging of dollar weakness, industrial demand and jewelry buying.

On the downside, while Wall Street has staged a nice rally, there are still concerns about Main Street, as unemployment continues to rise. The dollar has also been weakening, which is fueling fears of inflation down the road.

Among the top sectors for the month were solar energy, which rose 15.7%; gold miners, which rose 14.5%; and oil and gas equipment and services, which rose about 13%. The weakest sectors in September were homebuilders, which fell about 4%; gasoline, which declined 3.7%; and agriculture, which lost 2.3%.

Among the top sectors for the quarter were real estate investment trusts (REITs), which rose about 32%; global financials, which gained about 28.4%; and steel, which rose 24.7%. The weakest sectors in the third quarter were international agriculture, which fell 4.4%; oil, which lost 3.5%; and energy, which declined 1.7%.

For our full September ETF Performance report, click here.

Mutual funds have a 69-year head start over ETFs. As ETFs gain popularity and start to maximize their profit-making ability, the race is on for a sizable piece of the market share that mutual funds currently enjoy.

Daniel Tovrov for Mutual Fund Wire reports that there are several ways in which the ETF industry could become even more competitive with the mutual fund industry:

• Earning new capital is akey component in determining whether ETFs will remain competitive
• ETFs that stick to less exotic and esoteric indexes could have a greater chance of success
• Cost is a factor; investors are going to want more bang for their buck
• Funds with a long-term focus could attract investors who find a buy-and-hold strategy appealing

The ETF industry isn’t going to take over the mutual fund industry anytime soon – mutual funds are a $12 trillion behemoth. But the rapid growth seen in ETFs have them on the right track.

For more stories about mutual funds, visit our mutual fund category.

I was at the Schwab Impact conference earlier this week, where they announced the results of this study. Go to the Impact website to see who spoke. The overwhelming theme is that more and more advisors are embracing ETFs. Here are some stats on what Schwab actually found:

ETFs are the single most popular fund type that financial advisors are considering buying in the next six months. Advisors singled out a few sectors, as well – tech, energy and financial-related ETFs all got the nod, writes Cinthia Murphy for IndexUniverse. The report, however, showed that advisors are turning away from health care and consumer staples.

Advisors have a bullish six-month outlook for the S&P 500. Around 72% of advisors believe a rise in the index’s performance will happen in the next six months.

The latest survey also revealed:

• 39% of advisors will increase investments in ETFs, up from 35% last year
• 22% are considering buying commodity funds, up from 8% last year
• 15% will pick up high-yield bonds through various funds, down from 24% a year ago

For the most part, advisors foresee that the economic recession will be done with in the next 12 months with an expected increase in consumer spending and consumer saving. A majority thinks that unemployment will continue to rise, however. More than one-fourth of advisors expect an increase in interest rates in the next six months.

Max Chen contributed to this article.

Filings for new ETFs are pouring into the Securities and Exchange Commission (SEC), as providers try to capitalize on the proliferation of the industry. Major mutual fund providers are also trying to get in on the action and launch their own ETFs, adding an interesting dynamic to the industry’s growth.

Matt Hougan for Index Universe has some insight into the meaning of the ETF rush,  supplemented by Daniel Harrison’s blog. Some points to consider:

• Some ETFs in registration could enter the so-called “zombie” class of the ETF world, defined as those ETFs that track narrow slices of the market and trade with wide spreads.
• Important asset classes are becoming accessible through the ETF vehicle. The same manner in which narrow funds are coming to market also leads the way for some mega funds that track broad areas of the market.
• Competition will heat up, which works in investors’ favor. More offerings will keep expense ratios lower.
• The investor’s point-of-view may shift to that of a trader rather than a buy-and-holder.
• Many experts expect global ETF assets to grow to as much as $2 trillion-$3 trillion over the next few years. And this could be conservative, as the ETF industry is still in its infancy, with major growth ahead.

For more stories about ETFs, visit our ETF 101 category.

Total assets in U.S.-listed exchange traded products surged to $678 billion, a 4% increase since previous highs in July. Year-to-date, assets are up 25%.  Funds in fixed income, commodities and emerging markets are raking in the highest flows and garnering the most interest, explains Sam Mamudi for The Wall Street Journal.

The industry had 846 exchange-traded products from 36 providers at the end of August. The  latest regulation may curb some of the buying interest for those investors seeking commodity exposure through ETFs, as regulators try to curb speculation they believe has led to volatility in the market.

Other than that, ETFs are touted for their flexibility to trade on an exchange like a single stocks with transparency and liquidity. The amount of exposure that an ETF yields is unsurpassed, and investors love the lower fees and tax efficiencies that come with most ETFs, as well.

This year has been especially challenging for the industry in general, but the growth the ETF business has seen is a good indicator that when markets see a more firm rebound, ETFs will become even more prolific and popular with investors of all types.

For more stories about ETFs, visit our ETF 101 category.

Record trading volumes were experienced this summer, and providers are now busy working to bring even more new products to the table.

Daniel Harrison for Index Universe explains that the number of IPOs for indivdual companies is at a low right now, so providers are bringing new exchange traded products to the table more quickly than ever. Analysts are calling for a $3 trillion growth spurt over the next three years as a number of new providers are entering the industry and new products are launching.

The market is getting larger, and this is a good thing for investors in terms of competition, but  it will require a little extra vigilance and gut-checking when it comes to researching a product and deciding if it is a fit for a certain portfolio. Not all ETFs are right for all investors.

To deal with all these new choices, you may want to read up on a few things:

• The 60-Second ETF Evaluation
• 4 ETF Pitfalls and How to Avoid Them
• What’s Your Re-Entry Strategy?

For more stories about ETF industry growth, visit our ETF 101 category.