Global Exchange Traded Product (ETP) Industry Grows by 27 Percent in 2012

According to the authorative Blackrock ETP Landscape Survey1 for the period ended 31 December 2012, the worldwide ETP business enjoyed yet another year of significant growth in 2012. Total assets under management (AUM) rose by US$262,7 billion to US$1 93

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Global ETP Industry by Region

The United States remains the dominant region for the listing of ETPs with 34,6% of all ETPs covering US equity markets. Emerging Market ETPs are the next biggest equity group, with US$275867 million under management. China is the biggest area of investment for ETPs in emerging markets, followed by Brazil, South Korea and Morocco.

New Investment Inflows

Flows of new capital into global ETPs totalled US$262,7 billion in 2012 a significant increase in the net flows of US$173,4 billion in 2011 and US$182,1 billion in 2010. In fact, last year was the record year for inflows, breaking the previous high of US$259,7 billion set in 2008.

The biggest sector gains for the net inflows were Fixed Income ETPs and Emerging Market Equity ETPs.

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Global Flows Into Mutual Funds and ETPs

The Blackrock ETP Landscape Report finds that for the second year running, there was a net outflow of money from Developed Market Equity Mutual Funds (unit trusts) in 2012 of US$192 billion, compared with a net inflow of US$116 billion into developed market equity ETP, a swing of US$308 billion.

For Emerging Market Equity Funds, ETPs have gained new inflows of US$55 billion in 2012, compared with only US$12 billion for Emerging Market Equity Mutual Funds.

The Exchange Traded Product equity industry, accordingly, continues to gain market share at the expense of the global mutual fund industry.

South Africa ETP Industry

The South African ETP industry continued to grow steadily in 2012, increasing assets under management by 19% to R47,8 billion (US$5,5 billion) at the end of 2012. As shown in Table 2 below, the South African ETP industry has shown consistent growth for the last number of years and the number of ETPs in issue has grown from 2 in 2002 to 61 at the end of 2012.

Table 2