BlackRock‘s Global ETF Research Team is reporting that global exchange traded funds assets reached an all time high of $1 trillion at the end of 2009, up 45% from 2008. The MSCI World Index rose 27% in dollar terms over the same period.
BlackRock management believes that the challenging market conditions of 2008 caused a significant shift in investors’ risk appetite in their evaluation of counterparty risk and their desire for liquidity. During 2009 many investors found that ETFs met their desire for greater transparency in relation to the issues of cost, transparency of holdings, transparency of price, liquidity, product structure, risk and return as they relate to investment alternatives.
During the year, fixed income, equity and commodity-based ETFs enjoyed heavy inflows as some investors adjusted their risk profiles. After the markets turned in March, and kept rising through year-end, investments moved back into areas that had been shunned for the preceding year and a half. The changes in investor sentiment are shown in the net new asset data into ETFs tracking corporate bond, inflation, aggregate indices, international and emerging market indices and commodities.
According to BlackRock, the compound annual growth rate over the past decade for ETF assets globally was 56.3%, with 58.1% in the United States, 53.1% in Canada and 90.5% in Europe.
The global ETF industry had 1,939 ETFs with 3,775 listings, and assets of US$1,032 billion from 109 providers on 40 exchanges around the world at the end of December 2009. Combining both ETFs and Exchange Traded Products (ETPs), there were 2,558 products with 4,687 listings, assets of US$1,186.5 billlion from 132 providers on 43 exchanges around the world at year end 2009.
See the ETF directory for a complete listing of exchange traded funds.