ETF Assets Continued Year-on-Year Growth Through Q3, Despite Summer Market Volatility, According to Broadridge Financial Solutions

LAKE SUCCESS, N.Y., Oct. 29, 2015 – Exchange-traded fund (ETF) assets grew by $144 billion, or 7.4 percent, in the year ending September 30, 2015 -- largely driven by retail channels, according to quarterly data released today by Broadridge Financial Solutions, Inc., (NYSE:BR) via its Fund Distribution Intelligence. During the same period, long-term mutual fund assets from third party distributors declined by 2 percent, or $156 billion. 

“ETF assets continued year-on-year growth through the third-quarter, despite the worst stock market drop since 2008, with advisors accounting for the lion’s share of investment,” said Frank Polefrone, senior vice president of Broadridge’s Access Data product suite.  “This trend demonstrates the increased use of passive products. RIAs, which hold a higher percentage of passively managed funds, were the only retail channel with an increase of long-term fund assets over the last year.” 

Retail channels continued to generate the majority of ETF asset growth, which now represent 63 percent of all ETF assets. Registered investment advisors (RIAs) led all retail channels over the past year ending September 30, 2015, adding $46 billion in ETF assets, followed by wirehouses with $45 billion and independent broker dealers (IBDs) with $41 billion.  The only retail channel with increased assets for long-term mutual funds over this period was the RIA channel with an increase of $29 billion. 

Retail channels increased assets across several ETF global product categories, as defined by Morningstar, including fixed income, 23 percent, allocation funds, 22 percent, equity, 11 percent, and alternative, 5 percent. The two ETF categories that saw a decline in assets held by the retail channels were commodities, 18 percent, and convertibles ETFs, 9 percent. In contrast, all global product categories for long-term funds showed a decrease in assets over this same period. 

Additional findings:

• Total long-term mutual fund and ETF assets across retail and institutional channels reached $7.2 trillion and $2.09 trillion, respectively.
• On a year-to-date basis, total ETF assets increased by $5 billion, or 0.2 percent, while long-term funds sold through distributors decreased by $243 billion, or 3.3 percent.
• While retail ETF channels were up $150 billion over the past year, or 13 percent, ETF assets from institutional channels decreased by $6 billion, or 1 percent.
• Long-term funds from retail channels were down by $199 billion over the past year, while assets from the institutional channels were up $43 billion.

Broadridge’s Fund Distribution Intelligence comprises the most complete sales and asset data collection in the industry, creating transparency into more than $9 trillion of long-term mutual fund and ETF assets across a majority of mutual fund distributors.