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One of the unique attributes of Exchange Traded Funds (ETFs) and one which they share with managed funds, is their ability to create new units to grow their size. We take a look at the ETFs with the highest inflows in the 2018 Financial Year.
One of the unique attributes of Exchange Traded Funds (ETFs) and one which they share with managed funds, is their ability to create new units. This means that theoretically there is no limit to the size that an ETF can get to.
Below we have a look at which ETFs had the highest net inflows last financial year to see where investors have been placing their money. In what has become a year on year trend, the segment added over 30% in assets to close the financial year at $38.87 billion in size.
The 30% growth came as a combination of both capital growth and fund flows, with $7.38 billion in new inflows, up from $5.2 billion last financial year. Below we take a look at where the $7.38 billion came from and share some insights.
Last year we saw Vanguard’s Australian Share Fund (VAS) ranked 5th in total flows, taking $243m in new flows. This year Vanguard’s Australian Shares Fund is back on top, taking $663m in flows. Vanguard actually took 4 of the top 5 positions, cementing their position as the most popular ETF provider in Australia.
Interestingly, the largest ETF by market capitalisation, the SPDR S&P/ASX 200 Fund (STW), whilst last year taking $295m in flows, this year actually had a small ($8m) outflow. With a large outflow in one month, we suspect this was a institutional investor redeeming funds. Part of VAS’ high flows can also likely be explained by an institutional investor, with almost half of their total inflows coming in one month. The iShares S&P/ASX 200 ETF (IOZ) also saw a large institutional inflow in one month. Institutional investors dominate ETF trades in the more mature US and UK ETF markets, we think this is great, as it helps provide more liquidity in the market for us retail investors.
This year was the first year that inflows to global equity funds exceeded Australian equity funds. There’s likely a couple of reasons for this; one being ETFs being a convenient way to access global equities strategies, the other being continued strong performance in global markets enticing investors to invest offshore.
ETFs were first introduced as cost effective ways for investors to access market indexes. This approach still dominates, with 72% of all flows to ETFs going to index tracking ETFs. In fact, 7 of the top 10 funds by flow are index tracking ETFs. However, with Smart Beta and Actively Managed ETFs accounting for 17% and 11% respectively, it is clear that a growing amount of investors are using Exchange Traded Products to access these types of investments.
Fund manager behemoth Platinum joined the top 10 of inflows with their Platinum International Fund (PIXX) an ETF version of their popular managed fund. Only launched in September 2017, it had $235m in flows in the financial year.
Vanguard’s popular high yield strategy (VHY), which we wrote about earlier this year also landed in the top 10, as did Vaneck’s Equal Weight ETF (MVW), who offer an alternative to investors wanting avoid the high concentration at the top end of the Australian share market.
As per last year, over 80% of all inflows to ETFs can be attributed to the top 20% of funds by inflow, with 81% of flows going to these funds. 64, or 36% of ETFs finished the year with total funds of more than $100m.
Below we list the inflows to all the ETFs on the ASX in the last Financial Year.
| Ticker | Name | Total Inflow (millions) | Total Fund Size (millions) |
| VAS | Vanguard Australian Shares Index | $663.31 | $2,834.01 |
| VGS | Vanguard MSCI Index International Series | $461.37 | $1,097.48 |
| IOZ | iShares S&P/ASX 200 ETF | $410.33 | $1,164.06 |
| VEU | Vanguard All-World EX US Shares Index | $304.96 | $1,243.27 |
| VHY | Vanguard Australian Shares High Yield ETF | $269.24 | $1,075.50 |
| PIXX | Platinum International Fund (Quoted Managed Hedge Fund) | $235.08 | $210.87 |
| MVW | VanEck Vectors Australian Equal Weight ETF | $222.11 | $524.03 |
| QPON | BetaShares Australian Bank Senior Floating Rate Bond ETF | $221.47 | $236.70 |
| BILL | iShares Core Cash ETF | $186.82 | $197.04 |
| IAF | iShares UBS Composite Bond ETF | $161.17 | $583.48 |
| PLUS | VanEck Vectors Australian Corporate Bond Plus ETF | $158.66 | $195.44 |
| FAIR | BetaShares Australian Sustainability Leaders ETF | $157.89 | $164.18 |
| VTS | Vanguard US Total Market Shares Index | $151.69 | $1,343.71 |
| IVV | iShares Core S&P 500 | $146.05 | $2,739.08 |
| VGAD | Vanguard MSCI Index International Series (Hedged) | $145.22 | $412.89 |
| NDQ | Betashares NASDAQ 100 | $132.63 | $340.61 |
| IEU | IShares Europe ETF | $127.47 | $762.46 |
| ETHI | BetaShares Global Sustainability Leaders ETF | $125.46 | $210.02 |
| PAXX | Platinum Asia Fund (Quoted Managed Hedge Fund) | $110.05 | $92.22 |
| QUAL | VanEck Vectors MSCI World Ex-Australia ETF | $108.22 | $381.41 |
| QRE | Beta Shares S&P/ASX 200 Resources Sector ETF | $106.21 | $147.77 |
| IAA | iShares Asia 50 ETF | $105.84 | $433.94 |
| ROBO | ETFS ROBO Global Robotics and Automation ETF | $104.56 | $103.66 |
| VEQ | Vanguard FTSE Europe Shares ETF | $103.98 | $193.63 |
| HBRD | BetaShares Active Australian Hybrids Fund (managed fund) | $100.50 | $100.10 |
| IEM | iShares MSCI Emerging Markets ETF | $97.50 | $615.12 |
| VAP | Vanguard Australian Property Securities Index ETF | $96.71 | $1,024.33 |
| VIF | Vanguard International Fixed Interest (Hedged) ETF | $96.16 | $196.25 |
| MICH | Magellan Infrastructure Fund (Currency Hedged) (Managed Fund) | $90.70 | $179.30 |
| DJRE | SPDR Dow Jones Global Real Estate Fund | $89.27 | $242.48 |
| VACF | Vanguard Australian Corporate Fixed Interest Index ETF | $88.58 | $126.67 |
| VGE | Vanguard FTSE Emerging Markets Shares | $88.34 | $203.95 |
| MGE | Magellan Global Equities Fund | $86.02 | $1,051.31 |
| FLOT | Vaneck Vectors Australian Floating Rate ETF | $85.38 | $85.28 |
| IOO | IShares Global 100 ETF | $83.51 | $1,404.20 |
| MOGL | Montgomery Global Equities Fund (Managed Fund) | $76.37 | $81.28 |
| VSO | Vanguard MSCI Australian Small Companies Index | $76.04 | $189.31 |
| IJP | iShares MSCI Japan ETF | $68.11 | $262.71 |
| VDHG | Vanguard Diversified High Growth Index ETF | $68.01 | $64.92 |
| VAE | Vanguard FTSE Asia ex Japan Shares Index ETF | $67.68 | $97.29 |
| AAA | Betashares Australian High Interest Cash ETF | $64.89 | $1,310.72 |
| VAF | Vanguard Australian Fixed Interest Index | $60.84 | $704.84 |
| IJR | iShares Core S&P SmallCap 600 | $57.35 | $165.64 |
| WDMF | iShares Edge MSCI World Multifactor ETF | $55.69 | $70.99 |
| MVR | VanEck Vectors Australian Resources ETF | $55.22 | $96.84 |
| ESTX | ETFS EURO STOXX 50® ETF | $54.93 | $65.02 |
| SFY | SPDR S&P/ASX 50 Fund | $52.52 | $514.99 |
| WDIV | SPDR S&P Global Dividend Fund | $50.57 | $169.86 |
| MVA | VanEck Vectors Australian Property ETF | $50.36 | $119.87 |
| GOLD | ETFS Physical Gold | $49.85 | $591.17 |
| MVE | VanEck Vectors S&P/ASX MidCap ETF | $48.21 | $88.82 |
| A200 | Betashares Australia 200 ETF | $47.89 | $49.64 |
| HACK | BetaShares Global Cybersecurity ETF | $47.13 | $87.35 |
| IVE | iShares MSCI EAFE ETF | $46.22 | $330.61 |
| TECH | ETFS Morningstar Global Technology ETF | $44.09 | $57.67 |
| ZYAU | ETFS S&P/ASX 300 High Yield Plus ETF | $42.74 | $63.53 |
| IFRA | VanEck Vectors FTSE Global Infrastructure (Hedged) ETF | $39.90 | $77.07 |
| VDGR | Vanguard Diversified Growth Index ETF | $34.83 | $33.42 |
| INIF | InvestSMART Australian Equity Income Fund (Managed Fund) | $34.25 | $34.25 |
| BNKS | BetaShares Global Banks ETF – Currency Hedged | $33.69 | $71.79 |
| RCB | Russell Australian Select Corporate Bond ETF | $33.47 | $165.36 |
| ISEC | iShares Enhanced Cash ETF | $31.10 | $36.13 |
| ISO | iShares S&P/ASX Small Ordinaries ETF | $30.35 | $106.05 |
| UBA | UBS IQ MSCI Australia Ethical ETF | $29.11 | $204.60 |
| OZR | SPDR S&P/ASX 200 Resources Fund | $27.15 | $73.44 |
| ILB | iShares UBS Government Inflation ETF | $24.89 | $117.08 |
| QOZ | BetaShares FTSE RAFI Australia 200 ETF | $24.66 | $289.17 |
| HJPN | BetaShares WisdomTree Japan ETF – Currency Hedged | $24.38 | $63.68 |
| VDBA | Vanguard Diversified Balanced Index ETF | $23.80 | $23.65 |
| EX20 | BetaShares Australian Ex-20 Portfolio Diversifier ETF | $22.74 | $36.60 |
| FUEL | BetaShares Global Energy Companies ETF – Currency Hedged | $20.74 | $28.87 |
| BBUS | Betashares US Eq Strong Bear Hedged Fund | $20.68 | $59.23 |
| IWLD | iShares Core MSCI World All Cap ETF | $17.46 | $29.42 |
| EIGA | eInvest Income Generator Fund (Managed Fund) | $17.11 | $17.74 |
| VBND | Vanguard Global Aggregate Bond Index (Hedged) ETF | $16.78 | $16.73 |
| RDV | Russell High Dividend Australian Shares ETF | $16.42 | $281.66 |
| IHCB | iShares Global Corporate Bond ETF (Hedged) | $15.05 | $80.74 |
| IZZ | iShares China Large-Cap ETF | $14.52 | $96.40 |
| EINC | BetaShares Legg Mason Equity Income Fund (managed fund) | $12.76 | $12.89 |
| DMKT | AMP Capital Dynamic Markets Fund (Hedge Fund) | $11.17 | $28.85 |
| SMLL | BetaShares Australian Small Companies Select Fund (managed fund) | $11.14 | $22.40 |
| GROW | Schroder Real Return Fund (Managed Fund) | $10.68 | $47.15 |
| SWTZ | Switzer Dividend Growth Fund (Managed Fund) | $10.07 | $77.48 |
| RINC | BetaShares Legg Mason Real Income Fund (managed fund) | $9.90 | $10.47 |
| IHVV | iShares S&P 500 AUD Hedged | $9.70 | $107.85 |
| VDCO | Vanguard Diversified Conservative Index ETF | $9.56 | $9.67 |
| MHG | Magellan Global Equities Fund Currency Hedged (Managed Fund) | $9.00 | $67.14 |
| PMGOLD | Perth Mint Gold | $8.79 | $132.54 |
| IHHY | iShares Global High Yield Bond (Hedged) ETF | $8.69 | $26.17 |
| GDX | VanEck Vectors Gold Miners ETF | $8.62 | $68.89 |
| FOOD | BetaShares Global Agriculture Companies ETF – Currency Hedged | $8.28 | $17.38 |
| MOAT | Vaneck Vectors Morningstar Wide Moat ETF | $8.23 | $58.90 |
| IHD | iShares S&P/ASX Dividend Opportunities Fund ETF | $7.93 | $257.47 |
| CETF | VanEck Vectors ChinaAMC A-Share ETF | $7.93 | $10.14 |
| MVB | VanEck Vectors Australian Banks ETF | $7.79 | $35.45 |
| IHOO | iShares Global 100 AUD Hedged | $7.72 | $36.85 |
| BBOZ | BetaShares Australian Equities Strong Bear (Hedge Fund) | $7.71 | $89.25 |
| ZUSD | ETFS Physical US Dollar ETF | $7.68 | $19.87 |
| VLC | Vanguard MSCI Australian Large Companies Index | $7.59 | $83.68 |
| SSO | SPDR S&P/ASX Small Ordinaries Fund | $7.09 | $21.62 |
| UBW | UBS IQ MSCI World ex Australia Ethical ETF | $6.73 | $29.25 |
| GGUS | Betashares Geared US Equity Fund – Currency Hedged (Hedge Fund) | $6.65 | $17.66 |
| IHEB | iShares J.P. Morgan USD Emerging Markets Bond (AUD Hedged) ETF | $6.48 | $13.07 |
| QUS | Betashares FTSE RAFI US 1000 ETF | $6.39 | $41.41 |
| IHWL | iShares Core MSCI World All Cap (AUD Hedged) ETF | $6.37 | $12.03 |
| DRUG | BetaShares Global Healthcare ETF – Currency Hedged | $5.61 | $24.55 |
| VGB | Vanguard Australian Government Bond Index ETF | $5.32 | $137.18 |
| HEUR | BetaShares WisdomTree Europe ETF – Currency Hedged | $5.19 | $49.64 |
| VCF | Vanguard International Credit Securities Index (Hedged) ETF | $4.97 | $99.42 |
| UBP | UBS IQ MSCI Asia APREX 50 Ethical ETF | $4.64 | $8.94 |
| YANK | BetaShares Strong U.S. Dollar Fund (hedge fund) | $4.54 | $11.88 |
| MVS | VanEck Vectors Small Cap Dividend Payers ETF | $4.31 | $70.48 |
| CRED | BetaShares Australian Investment Grade Corporate Bond ETF | $4.02 | $4.02 |
| ESGI | VanEck Vectors MSCI International Sustainable Equity ETF | $4.02 | $4.17 |
| IJH | iShares Core S&P MidCap 400 | $3.90 | $143.27 |
| RARI | Russell Australian Responsible Investment ETF | $3.85 | $70.74 |
| ZYUS | ETFS S&P 500 High Yield Low Volatility ETF | $3.51 | $51.67 |
| EEU | BetaShares Euro ETF | $3.35 | $8.24 |
| AUDS | BetaShares Strong Australian Dollar Fund (hedge fund) | $3.16 | $4.19 |
| WEMG | SPDR S&P Emerging Markets Fund | $3.15 | $19.55 |
| CORE | ETFS Global Core Infrastructure ETF | $3.11 | $3.18 |
| UBE | UBS IQ MSCI Europe Ethical ETF | $3.04 | $11.07 |
| AUMF | iShares Edge MSCI Australia Multifactor ETF | $2.31 | $9.55 |
| OZF | SPDR S&P/ASX 200 Financials ex A-REITS Fund | $2.26 | $62.91 |
| QMIX | SPDR MSCI World Quality Mix Fund | $1.80 | $8.44 |
| ETPMAG | ETFS Physical Silver | $1.58 | $58.49 |
| VVLU | Vanguard Global Value Equity Active ETF (Managed Fund) | $1.58 | $6.31 |
| GEAR | BetaShares Geared Australian Equity Fund (Hedge Fund) | $1.23 | $75.23 |
| QCB | BetaShares Commodities Basket ETF – Currency Hedged (Synthetic) | $1.12 | $11.07 |
| IGB | IShares UBS Treasury ETF | $1.05 | $30.86 |
| UBJ | UBS IQ MSCI Japan Ethical ETF | $0.96 | $4.55 |
| GLIN | AMP Capital Global Infrastructure Securities Fund (unhedged) (managed fund) | $0.85 | $23.56 |
| QAG | BetaShares Agricultural ETF – Currency Hedged (Synthetic) | $0.57 | $2.92 |
| RSM | Russell Australian Semi-Government Bond ETFÂ | $0.12 | $61.14 |
| RGB | Russell Australian Government Bond ETF | $0.04 | $60.53 |
| FDIV | VanEck Vectors S&P/ASX Franked Dividend ETF | $0.03 | $3.91 |
| UBU | UBS IQ MSCI USA Ethical ETF | $0.01 | $6.79 |
| MNRS | Betashares Global Gold Miners ETF – Currency Hedged | $0.00 | $5.08 |
| MONY | UBS IQ Cash ETF | $0.00 | $1.00 |
| ETPMPM | ETFS Physical Precious Metal Basket | $0.00 | $5.02 |
| ZCNH | ETFS Physical Renminbi ETF | $0.00 | $0.49 |
| ZGOL | ETFS Physical Gold ETF | $0.00 | $13.47 |
| EMKT | VanEck Vectors MSCI Multifactor Emerging Markets Equity ETF | $0.00 | $3.86 |
| VMIN | Vanguard Global Minimum Volatility Active ETF (Managed Fund) | $0.00 | $2.07 |
| WXOZ | SPDR S&P World Ex Australia Fund | -$0.23 | $171.51 |
| RENT | AMP Capital Global Property Securities Fund (unhedged) (managed fund) | -$0.36 | $14.93 |
| ETPMPD | ETFS Physical Palladium | -$1.15 | $1.12 |
| QAU | BetaShares Gold Bullion ETF – Currency Hedged | -$1.15 | $57.21 |
| IKO | iShares MSCI South Korea Capped ETF | -$1.72 | $41.84 |
| UMAX | Betashares S&P500 Yield Maximiser Fund (Managed Fund) | -$1.81 | $93.31 |
| AOD | Aurora Dividend Income Trust (Managed Fund) | -$2.19 | $6.93 |
| WVOL | iShares Edge MSCI World Minimum Volatility ETF | -$2.20 | $10.51 |
| WXHG | SPDR S&P World Ex Australia (Hedged) Fund | -$2.23 | $82.47 |
| SPY | SPDR S&P 500 ETF Trust | -$2.44 | $21.91 |
| GOVT | SPDR S&P/ASX Australian Government Bond Fund | -$2.54 | $12.98 |
| KSM | K2 Australian Small Cap Fund | -$2.79 | $14.00 |
| ETPMPT | ETFS Physical Platinum | -$3.55 | $1.14 |
| QFN | Beta Shares S&P/ASX 200 Financials Sector ETF | -$4.51 | $22.26 |
| MVOL | iShares Edge MSCI Australia Minimum Volatility ETF | -$4.56 | $2.28 |
| BOND | SPDR S&P/ASX Australian Bond Fund | -$5.02 | $23.48 |
| IXJ | iShares Global Healthcare ETF | -$5.14 | $491.90 |
| BEAR | BetaShares Australian Equities Bear (Hedge Fund) | -$6.09 | $51.20 |
| STW | SPDR S&P/ASX 200 Fund | -$8.25 | $3,794.12 |
| KII | K2 Global Equities Fund (Hedge Fund) | -$8.82 | $17.12 |
| AUST | Betashares Managed Risk Australian Share Fund | -$11.31 | $21.71 |
| ILC | iShares S&P/ASX 20 ETF | -$13.07 | $319.35 |
| WRLD | Betashares Managed Risk Global Share Fund | -$14.25 | $28.82 |
| YMAX | BetaShares Australian Top 20 Equity Yield Maximiser Fund | -$15.48 | $373.95 |
| DIV | UBS IQ Morningstar Australia Dividend Yield ETF | -$16.17 | $11.12 |
| SYI | SPDR MSCI Australia Select High Dividend Yield Fund | -$16.86 | $164.32 |
| ETF | UBS IQ Morningstar Australia Quality ETF | -$19.44 | $8.37 |
| SLF | SPDR S&P/ASX 200 Listed Property Fund | -$21.00 | $554.02 |
| ITW | iShares MSCI Taiwan ETF | -$22.33 | $47.84 |
| ZOZI | ETFS S&P/ASX 100 ETF | -$23.07 | $9.47 |
| OOO | BetaShares Crude Oil Index ETF- Currency Hedged (Synthetic) | -$23.20 | $32.78 |
| POU | BetaShares British Pound ETF | -$36.15 | $20.98 |
| IXI | iShares Global Consumer Staples ETF | -$39.70 | $107.10 |
| USD | BetaShares U.S. Dollar ETF | -$67.14 | $462.91 |
| HVST | BetaShares Australian Dividend Harvester Fund (Managed Fund) | -$189.87 | $199.08 |
I am intrigued by the opening statement “One of the unique attributes of Exchange Traded Funds (ETFs) and one
which they share with managed funds, is their ability to create new
units”.
Surely this impacts on the “Exchange Traded Value of existing units” or do they accept cash “Off Market” to expand the fund? If so can “Sophisticated Investors” access this portal?
Hi Col. There is a market participant called a ‘Market Maker’ who creates ETF units by buying/selling the underlying securities and packaging up the ETF unit to the investor. These are generally investment bank type entities.
[…] the ETF market closed in on $40 billion last financial year, we knew it was only a matter of time until the $50 billion milestone was hit. […]