The ETF Space Is Kicking Off 2021 with Record Inflows

The exchange traded fund universe is expanding at its fastest pace ever to the start of a new year. The ETF space accumulated record monthly flows in February on rising bets of an economic rebound in 2021.

According to ETFGI data, investors funneled $139.5 billion into ETFs, with a majority of the new flows going into those that track the stock markets, the Financial Times reports. The record monthly inflows for the ETF industry was 5.7% higher than the previous best month for new business at $132 billion, which was set back recently in November.

“The ETF industry has now registered a monthly record for new inflows for a second time in just four months,” Deborah Fuhr, founder of ETFGI, told the Financial Times.

The record monthly flows come as U.S. equity markets hit all-time highs last month.

Over the first two months of 2021, global investors have funneled $222.5 billion into ETFs, more than double the amount for the same period last year when equity markets were heading toward a sharp correction due to the nascent coronavirus pandemic.

Among the winners of the new inflows, Vanguard attracted the lion’s share of the new ETF inflows, bringing in $63 billion for the first two months of 2021, up 48% from the $42.6 billion it gathered for the same period last year.

Meanwhile, BlackRock’s iShares brand saw $42.3 billion in inflows so far this year, compared to $30.4 billion for the first two months of 2020.

ARK Invest was also a standout this year, ranking as the third-fastest growing ETF provider with net inflows of $16.1 billion. The firm gathered $20.5 billion in new inflows over the whole of 2020.

“The strong inflows for Ark have helped to push global assets in actively managed ETFs beyond the $300bn milestone,” Fuhr added.

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