ETFs Were a Reliable Investment Vehicle in a Volatile Year | ETF Trends

As market volatility spiked in 2018, more investors turned to ETFs to diversify risk and access the robust liquidity offered from the rising popularity of the investment vehicle.

For example, BlackRock’s iShares remained the largest player in the field, attracting almost $168 billion in assets globally, with a handful of iShares ETFs experiencing record trading over 2018. Additionally, secondary trading volumes were over $7.3 trillion for iShares ETFs across the U.S. and Europe combined, compared to $5 trillion for 2017.

“Last year showed the ever-growing versatility of iShares exchange-traded funds. Investors around the world used ETFs to seek alpha, help manage risk, invest sustainably, and tap liquidity in tighter financial conditions,” Mark Wiedman, Global Head of iShares and Index Investments, said in a note. “ETFs are now established, natural parts of many investors’ portfolios.”

The ongoing inflows into ETFs reflect the continued popularity of the investment vehicle as investors’ tool of choice when accessing the global markets. At BlackRock, the iShares ETFs experienced a notable rise in adoption as a proxy for underlying securities, which is particularly noticeable during periods of heightened volatility, as many traders enjoyed the liquidity offered from these large ETF products.