For example, WisdomTree Japan Hedged Equity (NYSEArca: DXJ) is the best-selling ETF this year with net inflows of more than $4 billion. Shares of the fund’s manager, WisdomTree Investments (NasdaqGM: WETF), have rallied over 80% year to date.
In active funds, PIMCO Total Return ETF (NYSEArca: BOND) managed by Bill Gross has made a huge splash in the ETF’s first year.
Still, it has become much more difficult to launch a successful product in a market with so many different choices already, said Lin at Credit Suisse.
He notes that over 90% of the ETPs launched prior to 2006 could be deemed successes by garnering more than $100 million in assets. In contrast, only 36% of the products launched since 2006 have been successful in gathering $100 million in assets and 20% have been delisted altogether.
“Record inflows into ETPs have helped to mask the headwinds that issuers face when launching new products,” Lin wrote.