Markets
GLD

ETF Investors Bailed on Active Funds for Cheaper Passive Alternatives

InvestorPlace - Stock Market News, Stock Advice & Trading Tips

Investors in exchange-traded funds (ETF) and mutual funds have fled well-known active investment houses this year in favor of cheaper passive products, the Financial Times reported.

A person drawing a line graph with the phrase "ETF" in large letters on a chalkboardSource: Shutterstock

Vanguard had net inflows of $67.7 billion, while State Street Global Advisors, attracted more than $20 billion. Passive funds track an index of shares, rather than taking active bets on which securities will outperform.

Demand for State Street SPDR Gold Shares (NYSEArca:GLD) ETF accounted for the majority of its inflows.

Large managers such as Invesco, Franklin Templeton, Pimco, T Rowe Price and Capital suffered net redemptions of between $17.9 billion and $32.2 billion in H1 2020.

BlackRock (NYSE:BLK) in contrast saw inflows of around $74 billion across its funds, with its iShares ETF arm accounting most of the share of sales.

While passive funds pilfered market share from actively managed mutual fund rivals, the latter camp is still home to some investment ideas, InvestorPlace contributor Todd Shriber wrote last week.

The post ETF Investors Bailed on Active Funds for Cheaper Passive Alternatives appeared first on InvestorPlace.

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

In This Story

GLD BLK

Latest Markets Videos

InvestorPlace

InvestorPlace is one of America’s largest, longest-standing independent financial research firms. Started over 40 years ago by a business visionary named Tom Phillips, we publish detailed research and recommendations for self-directed investors, financial advisors and money managers.

Learn More