2021: a record-breaking year for European ETFs
Trackinsight, ETF Express data partners in these awards, reported that European ETFs in 2021 saw a record year for asset growth with over USD194 billion in net flows, with the record highest month for flows in history occurring in February 2021, with USD21.2 billion in inflows. The last month of negative flows was March 2020, Trackinsight reports.
It was also the record year for European products, with 231 new launches in Europe (total of 3124 listings) says Trackinsight, while five new issuers joined the party, with Bitpanda, Melanion, Iconic, FlexShares and Ridgex launching their first European ETFs in 2021.
Trackinsight’s Global ETF Survey 2022 found that 35 per cent of European investors plan to increase ETF allocations this year.
Commenting on the second year of record growth in the European ETF fund industry, Detlef Glow, Head of EMEA Research at Refinitiv Lipper, said: “These strong inflows are somewhat surprising since companies and investors had to weather the uncertainty and impacts caused by the COVID-19 pandemic, which should have led under normal circumstances to more cautious behaviour from investors.
“Therefore, it can be assumed that the massive financial and fiscal actions taken by governments and central banks around the globe have boosted the confidence of investors to stay in a risk-on mode. Therefore, it was not surprising that the European ETF industry hit new records in this environment.”
Interviewing the many practitioners in the European ETF industry for this ETF Express European ETF Awards report, the twelfth outing of our European awards, they all represent a vibrant and self-aware industry, which is enjoying its growth, but also mindful of the need to offer what investors want.
Previous years have seen the European ETF industry differ from the US industry with its domination by institutions, but this is the year when the retail ETF industry picked up across Europe, dominated by two key trends. ESG, as outlined by Refinitiv, but also cryptocurrencies.
The rise of the crypto ETP has seen it enjoying its first outing in the European ETF awards and the major crypto groups are all represented as winners here, from the SIX Exchange, winner of Best European Exchange for Listing Cryptocurrency ETPs, to ETC Group’s BTCE ETP which saw a remarkable growth of 34,259 per cent from launch on 8th June 2020 to 1st June 2021.
Interviewed for ETF Express, back in November of 2021, Jacob Hetzel, head of distribution at Germany’s digital wealth manager Scalable Capital, said that the stockmarket investing boom in Germany is driven by increased use of ETFs, and Ossiam’s Aous Labbane, head of business development, has also commented on ETF Express that appetite for ETFs is growing in France and French-speaking countries. Labbane comments that the IFA market in France is still driven by commissions which makes it hard for ETFs to make inroads, but higher interest rates are also driving change, as investors loathe to pay high fees for investments.
The summary of all these points is that ETFs democratise investment, offering low cost, transparent and liquid access to underlying markets. Something everyone in this report can celebrate.
Beverly Chandler, managing editor, ETF Express