Exchange traded fund assets rose about 11% for the first half of 2012, indicating asset appreciation and investor participation is strong. Most of the growth was seen over the first two months of the year.
“In the first six months of 2012, ETF assets increased $115 billion, or 11% from year end 2011, according to the ETF Industry Association. We attribute most of this increase to net cash flow into ETFs of $72 billion, and the remainder to asset value appreciation,” Tom Graves, S&P equity analyst, wrote in a recent note.
Most of this industry growth occurred in January and February 2012, when assets were up 13% to $139 billion. The stock market weakness and volatility caused the 2% decline seen from March through June, due to the ongoing Eurozone debt crisis and overall lack of global economic growth.
Equities accounted for most of the ETF asset growth, about 70%, through June 2012, followed up by the rise in commodities and fixed-income. Most of the new cash flow into equity ETFs could be attributed to outflows from mutual funds and single stocks, according to S&P Capital IQ. [Three ETFs to Safeguard a Portfolio]