Data from TrackInsight, provider of TrackInsight™ Global View, shows the global ETF market finished 2020 at a record high of $7.6 Trillion across 6,518 ETFs. A combination of strong equity market performance coupled with accelerating investor inflows contributed to the new record.
Despite challenges created by COVID and market volatility, all regions experienced double-digit growth rates over 2020.
- Asia-Pacific was the fastest-growing region, with ETF assets rising by 28.7% to a new high of $689 Billion, of which $69 Billion was new flow.
- Assets in European listed ETFs grew by 26.4%, reaching a new record of $1.3 Trillion with $138 Billion of new flow.
- The North American market grew 24.1%, reaching an all-time high of $5.6 Trillion in AuM with $536 Billion of new flows.
ETFs faced an acid test in 2020 and passed with flying colors. The tremendous growth we have witnessed demonstrates how ETFs have successfully convinced investors of the benefits of a liquid, tradable and transparent product – especially during volatile markets.Anaelle Ubaldino, Head of ETF Research and Investment Advisory, TrackInsight
Against this impressive backdrop, two areas of the ETF market stood out for trend-busting growth trajectories: Active and ESG.
Active ETFs grew by 55%, with $80 Billion of new flows, reaching a new high of $273.5 Billion in AUM. With nearly 200 new active ETFs brought to market in 2020, there are now over 1,052 listed on exchanges worldwide.
Environmental, Social, Corporate Governance (ESG) ETFs reached a tipping point in 2020, witnessing an incredible 223% growth over the year, achieving a new record of $189 Billion in AUM. ESG ETFs captured $97 Billion of flows over the course of 2020. Nearly 200 ESG ETFs were brought to market during the same period as ESG is set to become a key battleground for issuers over 2021.
ESG and Active ETFs also dominated in terms of overall performance, with 5 of the top 10 best performing ETFs globally (excluding ETCs and Leveraged Funds) following an ESG approach and 3 of the top 10 following an active strategy. All delivered triple-digit returns to investors over 2020.
Ubaldino added, “It’s also clear that 2020 was a long-awaited turning point for ESG ETFs with huge growth in this sector. With competition for potentially Trillions of dollars of new ESG assets heating up, we expect to see more issuers enter the ESG ETF market over 2021.”
Investors can track this explosive growth via TrackInsight™ Global View, available in North America exclusively via the Nasdaq Quandl platform, which provides a robust source of core and alternative data and also offers Nasdaq Cloud Data Service via its storefront.