Actively managed ETFs captured 25% of flows so far in 2024 despite representing just 7% of ETF assets, according to Morningstar's just released Global ETF Flows report.
iShares achieved record monthly global flows in June, tallying $57bn worldwide, the first half of the year report further highlighted.
Actively managed ETFs grew organically at 20%, while passive ETFs grew at a 3% organic rate. Actively managed assets grew to a record $889bn after starting the year with £714bn.
Fund groups outside of the largest ten providers are using actively managed strategies to win investors’ attention: $110bn of their $157bn in year-to-date flows were sourced from active ETFs.
Syl Flood, senior product manager, Morningstar, said: “The popularity of the active ETF approach in North America is very clear to see. US active managers have seen immense interest in these products so far in 2024 and the direction of travel, at the moment, only appears to be one way. In the meantime, though, passive ETFs continue to collect their normal billions, but active strategies is where the action is.”
“iShares had its greatest monthly flows ever. In fact, it has only had two quarters with outflows since 2008, and those outflows were very small. Its strong growth can be attributed, in part, to its prevalence in the model portfolios being utilised by financial advisers in the US — including those iShares constructs and markets itself.”
BlackRock’s DYNF had the greatest flows of any actively managed ETF, with $8bn.
iShares flows hit a dizzying $57bn in June, eclipsing its previously monthly record of $43bn in November 2023. Eighty percent of its June flows were sourced from US-domiciled vehicles, 16% from Ireland, and the remainder from nine other domiciles.
Vanguard S&P 500 ETF had $43bn of inflows, its greatest six-month tally in its history. Assets in VOO stand at $472bn.
Actively managed ETFs have captured 25% of flows so far in 2024 even though they represent just 7% of ETF assets. JPMorgan led all providers with $23.2bn of inflows, $8 billion of which was sourced from just eight of their 179 actively managed ETFs. Only 20 of 430 actively managed ETF providers had outflows in the first half of the year.
The Equity category holds 51% of assets and, given its growth rate relative to Fixed Income, looks to maintain over half of assets, at least until the next equities drawdown or bear market. Without US spot bitcoin flows, the Alternative category would be in net outflows for the year to date.
New products introduced so far in 2024 reflect the relative levels of maturity of each market. Most new funds in the U.S. are actively managed, since the race to achieve scale in core passive strategies is all but over. Meanwhile, product innovation in Ireland and Luxembourg, which serve investors in Europe and other markets, is still focused on passive strategies.
