Global ETF flows continued their positive trend in January 2018, with an increase of €96.6 billion, according to data from European ETF provider Amundi. The US market gained most of the inflows, at €78.6bn, against €13.2bn for the European market.

ETFs attract €96.6 billion net inflows in January, finds Amundi.

In terms of asset classes, at both European and global levels, equity ETFs attracted the vast majority of investment volumes, at €10.9bn and €82.8bn respectively.

In the European market, sector and smart beta ETFs saw strong demand among equity products, accumulating €4.5bn of inflows, of which €1.2bn went into financial ETFs and €691 million into multi-factor ETFs, making them leaders in their respective categories.

In geographic terms, investors in the European equity ETF market favoured their own market (€1.2bn flowed into ETFs tracking eurozone exposures and €812m for ETFs tracking Europe-wide equities) but also diversified their investments in emerging markets (€1.7bn) and global ETFs (€1.3bn). This came at the expense of North America which saw relatively muted flows of €507m. In contrast, investors in the US ETF market further strengthened their positions in North American ETFs at €36.2bn.

Inflows into fixed income ETFs globally amounted to €10.8bn, of which €1.6bn was in Europe-listed funds and €9bn from US-listed ETFs. Corporate bonds suffered significant redemptions; €42m were withdrawn from the European market and €1.8bn from the US market.

In the European market, some fixed income segments continued to attract capital in January. This was the case for emerging market debt (€965m), and US inflation-linked index bonds (€754m).

The ETF market has grown enormously over the past few years. According to research by EY, global ETF assets – which totalled $417bn in 2005 – reached $4.4 trillion by the end of September 2017, returning a compound average growth rate of around 21%.

The EY report goes on to suggest that ETF assets have the potential to hit $7.6 trillion by the end of 2020, assuming a forward-looking compound average growth rate of 18% (13% – 14% of which is expected to come from net new inflows).