Charles Schwab (NasdaqGS: SCHW) has become one of the largest custodians of exchange traded funds (ETFs) over the past year, with growth in this segment showing good momentum.
Over the past year, ETF assets custodied at Schwab are up 32% to $121 billion. Retail ETF investment assets are about 37% of the total Schwab ETF AUM, according to a recent ETF Investor Snapshot from the firm. U.S. equity and sector ETFs are showing the most popularity. [Schwab on Schedule For ETF 401(k) Launch.]
Overall, the numbers are indicating that Schwab clients who held ETFs had more total assets than those who did not invest in the tools. Retail traders are showing a trend toward high usage of ETFs, but with a lower total portfolio allocation to ETFs, with about 18% of their portfolio dedicated to ETFs. [Will New Acquisitions Benefit Future Schwab ETF Products?]
The moral? The ETF industry is just getting warmed up, and investors are getting their feet wet with ETFs. Based on the numbers, investors seem to like the results of investing in ETFs. [Schwab’s ETF Select List Dumbs it Down.]
Tisha Guerrero contributed to this article.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.