ETFGI, a leading independent research and consultancy firm on trends in the global ETF/ETP ecosystem, reported today that assets invested in Smart Beta ETFs and ETPs listed globally increased by 32.3% during 2017 to reach a new high of US$658.35 Bn at the end of December. (All dollar values in USD unless otherwise noted.)
Highlights
Assets invested in Smart Beta ETFs/ETPs listed globally increased by a record $ 160.61 billion during the year, to reach a new high of $658.35 billion. Year-to-date, through end of December 2017, Smart Beta ETFs and ETPs listed globally saw net inflows of $71.75 Bn. Assets in market cap ETFs increased by 40.3% in 2017 which is significantly more than the 32.3% increase in Smart Beta assets.
According to ETFGI’s December 2017 Global Smart Beta ETF and ETP industry insights report, an annual paid-for research subscription service, assets invested in Smart Beta ETFs/ETPs listed globally grew by a record US$160.61 Bn during 2017, almost double the previous record of US$87.41 Bn set in 2016. The increase of 32.3%, from US$497.74 Bn at the end of 2016, also represents the greatest growth in assets since 2009 when markets recovered following the 2008 financial crisis.
Top 20 Smart Beta ETFs by net new assets: Global
| Name | Ticker | Assets (US$ Mn) Dec-17 |
ADV (US$ Mn) Dec-17 |
NNA (US$ Mn) YTD 2017 |
| Vanguard Value ETF | VTV US | 36,532 | 128.6 | 5,075 |
| iShares MSCI USA Momentum Factor ETF | MTUM US | 5,427 | 39.6 | 3,341 |
| Vanguard Growth ETF | VUG US | 31,403 | 89.7 | 2,179 |
| iShares MSCI USA Minimum Volatility ETF | USMV US | 15,076 | 55.1 | 1,539 |
| Vanguard Small-Cap Value ETF | VBR US | 12,639 | 35.5 | 1,463 |
| Schwab Fundamental US Large Company Index ETF | FNDX US | 3,761 | 9.5 | 1,462 |
| Schwab Fundamental International Large Company Index ETF | FNDF US | 3,463 | 9.9 | 1,365 |
| iShares MSCI EAFE Minimum Volatility ETF | EFAV US | 8,364 | 40.0 | 1,327 |
| iShares Core Dividend Growth ETF | DGRO US | 2,653 | 13.7 | 1,284 |
| iShares MSCI EAFE Value ETF | EFV US | 6,401 | 31.7 | 1,278 |
| Schwab US Dividend Equity ETF | SCHD US | 7,131 | 29.4 | 1,223 |
| iShares Automation& Robotics UCITS ETF | RBTX LN | 1,484 | 18.0 | 1,171 |
| Guggenheim S&P 500 Equal Weight ETF | RSP US | 14,993 | 43.8 | 1,115 |
| iShares International Select Dividend ETF | IDV US | 4,888 | 14.8 | 1,108 |
| Schwab Fundamental US Small Company Index ETF | FNDA US | 2,672 | 6.9 | 1,096 |
| iShares Edge MSCI Europe Value Factor UCITS ETF | IEFV LN | 1,762 | 5.4 | 1,040 |
| iShares Edge MSCI USA Value Factor UCITS ETF | IUVL LN | 1,320 | 4.9 | 985 |
| Vanguard Mid-Cap Value ETF | VOE US | 8,349 | 23.0 | 962 |
| First Trust Value Line Dividend Index Fund | FVD US | 4,195 | 10.2 | 953 |
| First Trust Nasdaq Bank ETF | FTXO US | 1,212 | 1.9 | 953 |
Similarly, the top 10 ETPs by net new assets collectively gathered US$661.56 Mn year-to-date during 2017.
Top 10 Smart Beta ETPs by net new assets: Global
| Name | Ticker | Assets (US$ Mn) Dec-17 |
ADV (US$ Mn) Dec-17 |
NNA (US$ Mn) YTD 2017 |
| FI Enhanced Global High Yield ETN | FIHD US | 1,134 | 3.3 | 357 |
| Psagot Sal Europe WisdomTree Export Oriented (NTR) ILS (40a) | PSGT304 IT | 113 | 0.3 | 101 |
| TACHLIT S&P AERO & DEFENSE | TCSP145 IT | 53 | 0.2 | 44 |
| Barclays ETN+ Shiller CAPE ETN | CAPE US | 95 | 0.3 | 39 |
| Psagot Sal Japan WisdomTree (NTR) ILS (40a) | PSGT306 IT | 233 | 0.4 | 25 |
| ETRACS Monthly Pay 2xLeveraged U.S. Small Cap High Dividend ETN | SMHD US | 44 | 0.5 | 21 |
| Harel Sal S&P 500 Low Volatility | HRSPL82 IT | 79 | 0.1 | 20 |
| NEXT NOTES Japan Equity High Beta Select 30 Net Total Return ETN | 2068 JP | 23 | 0.1 | 19 |
| NEXT NOTES Japan Equity Low Beta Select 50 Net Total Return ETN | 2069 JP | 21 | 0.2 | 19 |
| NEXT NOTES AI Companies 70 Net Total Return ETN | 2067 JP | 32 | 0.9 | 18 |
Value Factor ETFs/ETPs listed globally saw net inflows of US$2.63 Bn in December, growing net inflows for 2017 to US$16.66 Bn. Multi Factor ETFs and ETPs gathered net inflows of US$1.41 Bn in December, bringing net inflows for 2017 to US$12.85 Bn.
To conclude, investors have tended to invest in lower cost and Value Factor ETFs in 2017 with the Vanguard Value ETF (VTV US) accumulating net inflows of US$1.40 Bn and a TER of 6bp.
For more information on the latest ETF trends, visit our current affairs category.