Aussie ETF industry reaches close to $170b in November

Australian exchange traded fund (ETF) industry reached a new all-time high of approximately $170 billion in November, driven by global equities, according to Betashares.

November also marked a month-on-month significant growth in assets (13.1%) for a total monthly market cap increase of $19.6 billion.

At least of $10 billion (50%) of the growth this month came from conversions of existing unlisted active funds into Active ETFs as several new issuers joined the industry.

Also, strong asset value appreciation, particularly in global equities exposures, and net inflows contributed the remainder of the growth, according to the Betashares Australian ETF Review.

What is more, excluding conversions, net inflows of $2.1 billion were recorded in the month, the second highest level of net flows in 2023 to date.

At the same time, the report said it was an exceedingly busy month in product development, with more ETFs launched in November 2023 than in any month before.

In total 15 new funds were launched, including an initial suite of Active ETFs from Dimensional and Macquarie Funds Group.

“In a meaningful departure from the trend observed throughout 2023, strong performance and reduced concerns over meaningful future interest rate rises led global equities exposures to be the most popular category for investors in November, with around $955 million of net inflows (45% of total net flows for the month). Australian Equities were the second most popular category recording approximately $600m of net inflows,” the report said.

Last month also saw the increasing maturity of the industry, with a number of institutional allocations to ETFs as, according to Betashares, large institutional flows into ETFs are commonplace in more mature markets like the US, this trend is expected to continue and accelerate in the local market over time.