US ETF Inflows Hit A Record $188B In 2012

By
A A A

Investors poured a record $188 billion into U.S.-listed ETFs in 2012, eclipsing a previous record of more than $175 billion in 2008, as a variety of asset classes shined-including domestic as well as international equities, and particularly fixed income.

Overall, total ETF assets ended the year at almost $1.349 trillion, 27 percent higher than the $1.062 trillion a year earlier and 2 1/2 times as much as the $537 billion total at the end of 2008, according to data compiled by IndexUniverse.

The 2012 year-end asset total, just shy of an all-time record of $1.350 trillion reached on Thursday, Dec. 20, also reflects the rise in global stock markets, including a 7.3 percent increase in the Dow Jones industrial average in all of 2012.

Last year's impressive haul amounts to yet another clear sign that ETFs are not only here to stay, but are increasingly chipping away at the dominance of mutual funds. That's particularly clear in equities, where mutual funds have been facing outflows in the past few years while ETFs have raked in assets.

Investors are waking up to the low costs, transparency and tax efficiencies of exchange-traded funds by gravitating to the ETF wrapper, and the strong showing by fixed income in 2012 suggests bond funds are likely to be a vibrant and growing piece of the ETF universe going forward.

"2012 was the strongest year ever for ETFs, and for good reason," IndexUniverse Director of Research Dave Nadig said. "Investors are realizing that the old high-cost, low-transparency mutual fund world makes less sense than ever. ETFs keep delivering on their core promises of low cost, good exposure, tax efficiency and liquidity."

2012 Assets By Class And Total Assets ($, M)


Net Flows AUM % of AUM
U.S. Equity 68,960.66 607,025.77 11.36%
International Equity 52,116.46 332,453.77 15.68%
U.S. Fixed Income 43,981.15 226,889.05 19.38%
International Fixed Income 11,780.12 25,882.47 45.51%
Commodities 10,217.71 118,092.89 8.65%
Currency -1,476.16 2,690.28 -54.87%
Leveraged -873.08 13,583.89 -6.43%
Inverse -62.05 16,645.98 -0.37%
Asset Allocation 755.31 2,404.35 31.41%
Alternatives 2,962.97 3,246.85 91.26%
Total: 188,363.08 1,348,915.30 13.96%

To The Giants Go The Spoils

Of the $188 billion in 2012 inflows, $151 billion, or 80 percent of the total, came from the three biggest firms:BlackRock's iShares, State Street Global Advisors and Vanguard.

The dominance of bigger firms is by now a familiar tale in the U.S. ETF industry, which began about 20 years ago with the launch of SSgA's SPDR S&P 500 ETF (NYSEArca:SPY).

In that light, it's no surprise that last year's asset-gathering winner was SPY, the biggest ETF in the world. It pulled in $15.77 billion, or more than 8 percent of the total asset haul.

Also, we've spilled a bit of ink this year on the Nos. 2 and 3 funds:the Vanguard MSCI Emerging Markets ETF (NYSEArca:VWO) and the iShares MSCI Emerging Markets Index Fund (NYSEArca:EEM).

They both gathered about $10.5 billion, with the lion's share of EEM's asset haul occurring after Oct. 2, when Vanguard announced that next year it will abandon the MSCI index VWO has shared with EEM in favor of a benchmark created by FTSE.

Fixed Income Shined In 2012

As a percentage of assets under management, bond ETF assets grew quite sharply in 2012, and the launch of Bill Gross' Pimco Total Return ETF (NYSEArca:BOND) on March 1 kept the phenomenon in sharp focus throughout the year.

BOND, the second-most-successful ETF launch in history after the bullion fund SPDR Gold Shares (NYSEArca:GLD), ended 2012 as the 10 th -most-popular fund. It gathered $3.77 billion and ended the year with $3.87 billion in assets, making it the most successful fund launch of 2012.

GLD, the world's second-biggest ETF-with assets of $72 billion-ended the year as the No. 5 fund, with inflows of $5.75 billion, as investors continued to grapple with uncertainty in the macroeconomy.

That uncertainty, plus the search for yield, fueled much of the popularity of bond funds, and the Top 10 list included fixed-income ETFs such as the iShares iBoxx $ Investment Grade Corporate Bond Fund (NYSEArca:LQD) and the iShares iBoxx $ High Yield Corporate Bond Fund (NYSEArca:HYG). LQD added $6.85 billion, while HYG pulled in $4.5 billion.

Overall, bond funds pulled in around $56 billion, or about 30 percent of the total asset haul.

More to the point, the nearly $44 billion that flowed into U.S. bond funds was almost 20 percent of the total, while the nearly $12 billion in new money invested in international bond funds constituted more than 45 percent of the total-both higher percentages than in either U.S. or international equities.

Top ETFs In 2012 ($, M)

Ticker Name Issuer 2012 Year-End Flows 2012 Year-End AUM 2012 Year-End Turnover
SPY SPDR S&P 500 SSgA 15,767.39 123,000.83 5,119,479.82
VWO Vanguard MSCI Emerging Markets Vanguard 10,592.05 59,097.00 221,787.13
EEM iShares MSCI Emerging Markets BlackRock 10,506.25 48,184.23 525,405.21
LQD iShares iBoxx $ Investment Grade Corporate Bond BlackRock 6,850.84 25,349.50 61,579.06
GLD SPDR Gold SSgA 5,745.15 72,239.33 429,156.78
IVV iShares Core S&P 500 BlackRock 5,242.17 35,097.73 132,698.11
VNQ Vanguard REIT Vanguard 4,756.10 15,386.24 37,320.20
HYG iShares iBoxx $ High Yield Corporate Bond BlackRock 4,503.78 15,972.25 76,217.85
VOO Vanguard S&P 500 Vanguard 3,814.85 6,599.25 13,336.04
BOND PIMCO Total Return PIMCO 3,772.48 3,870.50 10,127.57

Biggest Asset-Losing ETFs In 2012 ($, M)

Ticker Name Issuer 2012 Year-End Flows 2012 Year-End AUM 2012 Year-End Turnover
SHY iShares Barclays 1-3 Year Treasury Bond BlackRock - 3,013.49 8,045.23 29,968.55
EFA iShares MSCI EAFE BlackRock - 2,509.45 38,814.93 254,994.83
XLU Utilities Select SPDR SSgA - 1,992.41 5,457.94 66,182.99
UUP PowerShares DB US Dollar Index Bullish Invesco PowerShares - 1,157.85 689.12 13,573.71
FAS Direxion Daily Financial Bull 3x Direxion - 1,149.11 1,135.11 154,738.83
XLK Technology Select SPDR SSgA -944.10 8,283.79 68,281.92
TIP iShares Barclays TIPS Bond BlackRock -890.21 22,284.45 31,784.61
SSO ProShares Ultra S&P 500 ProShares -807.54 1,279.23 107,120.47
DIA SPDR Dow Jones Industrial Average Trust SSgA -761.03 10,923.38 195,454.96
TNA Direxion Daily Small Cap Bull 3x Direxion -683.34 732.06 170,702.66


2012 Year-End League Table ($, M)

Issuer Net Flows AUM % of AUM Turnover
BlackRock 62,018.75 558,014.20 11.11% 3,823,408.92
SSgA 36,296.75 329,181.46 11.03% 7,251,714.90
Vanguard 53,382.07 244,433.00 21.84% 520,956.31
Invesco PowerShares 6,404.84 71,023.88 9.02% 853,633.13
Van Eck 4,321.87 27,668.62 15.62% 313,006.73
ProShares 486.60 21,147.28 2.30% 807,804.84
WisdomTree 4,734.46 18,285.58 25.89% 44,212.67
Guggenheim 814.73 12,377.73 6.58% 75,652.99
PIMCO 4,887.40 9,103.21 53.69% 22,942.56
Charles Schwab 2,841.79 8,552.59 33.23% 15,908.39
First Trust 1,204.89 8,189.14 14.71% 22,470.23
Direxion -958.40 5,938.15 -16.14% 628,984.43
Barclays Capital 1,927.46 5,793.82 33.27% 228,345.02
JPMorgan 1,262.93 4,883.47 25.86% 12,585.05
ALPS 2,715.91 4,677.44 58.06% 8,646.93
ETF Securities 370.10 4,071.98 9.09% 10,848.57
US Commodity Funds 648.94 3,139.62 20.67% 130,600.29
Northern Trust 1,762.85 2,293.89 76.85% 2,430.12
Global X 346.45 1,511.72 22.92% 4,952.52
UBS 558.55 1,474.55 37.88% 3,313.99
Merrill Lynch -65.06 1,214.12 -5.36% 2,203.41
Emerging Global Shares 471.63 1,092.58 43.17% 1,664.68
VelocityShares 949.40 851.37 111.51% 73,002.98
AdvisorShares 256.76 611.04 42.02% 3,367.40
IndexIQ 135.71 579.94 23.40% 1,151.27
GreenHaven -79.15 474.61 -16.68% 961.19
Credit Suisse 43.94 435.37 10.09% 966.35
Pacer Financial -87.86 421.69 -20.84% 596.80
Goldman Sachs 260.86 258.41 100.95% 286.84
RBS Securities 96.01 231.51 41.47% 553.12
Precidian 20.29 201.98 10.04% 1,196.13
Fidelity 181.96 174.50 104.28% 356.99
Deutsche Bank -37.48 140.16 -26.74% 261.44
Exchange Traded Concepts 113.17 106.26 106.51% 247.48
Jefferies -12.62 73.85 -17.08% 103.40
Teucrium -27.78 59.32 -46.83% 1,499.09
Pyxis 31.96 31.95 100.02% 34.47
Morgan Stanley - 29.35 0.00% 33.82
FFCM -0.08 27.31 -0.31% 171.59
Arrow Investment Advisors 26.22 26.88 97.53% 54.63
Columbia 1.28 25.74 4.96% 76.25
Pax World 14.00 25.15 55.68% 66.94
Factor Advisor 4.78 19.60 24.40% 89.62
BNP Paribas 16.19 17.81 90.92% 5.07
Huntington Strategy Shares 15.37 16.10 95.47% 27.54
CitiGroup 8.70 4.46 195.28% 80.08
Russell -4.07 2.90 -140.28% 14.15

Permalink | 'copy; Copyright 2009 IndexUniverse LLC. All rights reserved

Don't forget to check IndexUniverse.com's ETF Data section.

Copyright ® 2013 IndexUniverse LLC . All Rights Reserved.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , ETFs

Referenced Stocks: EEM , GLD , HYG , LQD , SPY

IndexUniverse

IndexUniverse

More from IndexUniverse:

Related Videos

Your Car Is Spying on You
Your Car Is Spying on You           

Stocks

Referenced

Most Active by Volume

73,078,214
  • $30.33 ▼ 3.90%
57,046,796
  • $15.52 ▲ 0.45%
51,290,831
  • $100.57 ▲ 0.04%
39,855,468
  • $8.13 ▲ 1.37%
31,693,544
  • $5.50 ▲ 20.35%
31,532,510
  • $10.33 ▲ 0.78%
31,526,753
  • $39.10 ▲ 47.21%
28,366,542
  • $26.36 ▲ 1.19%
As of 8/20/2014, 04:04 PM

Find a Credit Card

Select a credit card product by:
Select an offer:
Search
Data Provided by BankRate.com