The ETF industry crossed an exciting milestone on Friday: For the first time, there are over 3,000 ETFs trading at the same time.
The two funds listed on September 9 that pushed the ETF industry from 2,999 to 3,001 funds currently available to investors are the Emerge EMPWR Sustainable Select Growth Equity ETF (EPGC) and the Emerge EMPWR Unified Sustainable Equity ETF (EPWR).
EPGC and EPWR launched as part of the firm’s EMPWR ETFs, a suite of five ETFs dual-listed on the Cboe BZX Exchange and the Neo Exchange, Cboe Global Markets’ solution for Canadian investors. EMPWR is designed to support and highlight women-led investment managers while promoting sustainable investing, according to a statement from the firm.
“It is particularly exciting that the firm that pushed the ETF industry is female-led-focused on ESG strategies,” Todd Rosenbluth, head of research at VettaFi, said. “Relative to other financial services industry segments, the ETF industry has been more inclusive, while attempting to open the door for more female leaders, evidenced by the Women in ETFs network.”
The first ETF, the SPDR S&P 500 ETF Trust (SPY), will turn 30 years old in January. The fund has grown to become the largest ETF in the world, with assets under management reaching $361 billion as of September 9, according to VettaFi.
From one fund in 1993, the ETF market grew to 102 funds by 2002, and nearly 1,000 by the end of 2009, according to Investopedia.
While many more than 3,000 ETFs have been launched since the very first ETF debuted in 1993, scores of funds are closed every year due to a lack of investor interest and a limited amount of assets. It’s expensive to launch an ETF, and operation costs are also significant.
In 2021, there were 457 new ETFs launched in the U.S., and 59 ETFs closed during that period, the lowest number of closures since 2014, according to Statista. The year prior, in 2020, there were 315 new ETFs and 182 closures.
“Since SPY launched nearly 30 years ago, demand, not only supply, has exploded with many advisors building model portfolios using ETFs as end clients request access. ETFs provide diversification, liquidity, and cost savings benefits unlike any other alternative,” Rosenbluth said.
Regarded as the fastest-growing product in the investment industry, both in terms of assets under management and product innovation, ETFs in the U.S. ended 2021 with over $7 trillion in combined assets under management.
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