After President Donald Trump’s election day victory, one year has passed and led to an equity market rally that fueled a surge in ETF investment demand.
Ever since the contentious presidential election day victory, assets under management for mutual funds and ETFs jumped 16%, or $2.9 trillion, to $21.1 trillion, reports Jeff Cox for CNBC.
The rising demand for fund investments has been attributed to the robust performance in U.S. equities and the Dow Jones Industrial Average gained 29% over the past 12 months while the S&P 500 is 21.6% higher, with both hitting upon new record highs.
In response to the ongoing rally, investors funneled billions of dollars into funds of all kinds since Trump’s election victory, with the majority of assets finding their way to passive funds. While mutual funds still enjoy the lion’s share of assets in the passive investment industry, assets in passive index-based ETFs are quickly gaining.
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Since September 30, 2016, passive funds attracted $686 billion versus just $5.2 billion for net active funds.
Looking at total asset gains for inflows in both ETFs and mutual funds, equity-related strategies have done best, with $2 trillion in inflows that have bolstered total assets by 21.6%, followed by mixed assets with a 19.6% gain in assets. In contrast, bond funds saw assets rise by 11% to $4.2 trillion.
There are now 2,073 U.S.-listed exchange traded products, which include both exchange traded notes and ETFs, on the market, with close to $3.3 trillion in assets under management. So far this year, 222 new funds have launched while 125 have delisted, and the overall industry has attracted $391.2 billion in net inflows year-to-date. In October alone, U.S.-listed ETFs experienced $52.9 billion in net inflows.
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