ETF Edge: Tom Lydon On Recent ETF Trends Through Q3 2020

The NYSE has been reporting on the continued rise of ETFs following the close of Q3. Things are approaching $5 trillion in assets under management (AUM). ETF Trends CEO, Tom Lydon, hopped on CNBC’s “ETF Edge,” with host Bob Pisani to discuss the growing ETF universe, how the flows are looking, the increased pivot towards active non-transparent funds, and other areas that have stuck out in particular during the first three-quarters of 2020.

Lydon shares similar praise, noting how it’s been a great year for fixed income. Looking at low rates, more investors and advisors are pushing into corporate and high yield bond ETFs, which has been huge at $175 billion. On the equity side, the message has traditionally revolved around low-cost beta strategies. However, there’s been a major shift to technology weighted indexes like QQQ, but also thematic strategies, which have gone through the roof (the WFH fund comes to mind).

Asset Classes (Year-to-Date)

  Net Flows ($, mm) AUM ($, mm) % of AUM
U.S. Equity 93,967.30 2,762,336.45 3.40%
International Equity 20,351.87 898,660.16 2.26%
U.S. Fixed Income 157,055.51 938,419.54 16.74%
International Fixed Income 15,775.93 112,127.42 14.07%
Commodities 46,863.07 149,577.42 31.33%
Currency 641.15 1,960.00 32.71%
Leveraged 2,105.79 40,773.00 5.16%
Inverse 13,560.81 13,321.61 101.80%
Asset Allocation 2,201.10 12,310.14 17.88%
Alternatives 125.97 5,379.26 2.34%
Total: 352,648.50 4,934,865.00 7.15%

Many companies in the mutual fund space are now getting in with the ETF business.

Lydon states, “Yes, active launches have been notable as big fund companies like T. Rowe Price and American Century are offering active non-transparent ETFs. Some active managers are also showing their strength, like ARK Invest, that has moved from $3 billion to $12 billion in the last year.”

Watch Tom Lydon Talk Recent ETF Trends On ETF Edge:

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