ETFs growing at twice the pace of UCITS funds, finds PwC

Sep 23rd, 2022 | By | Category: Latest news

EU-domiciled ETFs have recorded asset under management growth of 18.7% per annum over the past ten years, more than twice the 9% growth rate of the broader UCITS market, according to research from PwC Luxembourg.

Robert Glover, Partner, Global Fund Distribution at PwC Luxembourg

Robert Glover, Partner, Global Fund Distribution at PwC Luxembourg.

PwC has released its annual European ETF Listing and Distribution poster showcasing the growth of the ETF market while breaking down emerging themes including the impact of ESG.

Despite the impressive long-term growth rate, PwC notes that AUM within EU-domiciled ETFs decreased by 10% to €1,193 billion over the past year, as of the end of June 2022. The firm highlights the pullback in AUM occurred due to both outflows and negative performance amid a volatile market environment caused by high inflation rates, increasing interest rates, and geopolitical tensions.

In terms of listings and registrations, around 62% of European ETFs were tradable on two or more stock exchanges. Over 22,000 cross-border registrations of European ETFs were recorded, representing a significant increase of 12.6% compared to June 2021.

PwC notes that sustainable finance has exploded within the EU’s ETF industry with more than a quarter (26%) of the 1,806 EU-domiciled ETFs classified as either Article 8 or Article 9 products. Additionally, more than half of the ETFs that were listed in the past year, or 214 out of 421 products, were classified within these categories.

Looking at the league table of top cross-border ETF asset managers, BlackRock remains in the highest position with 35 distribution countries, followed by Amundi and Fidelity Investments at 23 distribution countries each, and Invesco and Vanguard, each with 22 distribution countries.

Robert Glover, Partner, Global Fund Distribution at PwC Luxembourg, said: “This year’s annual ETF poster reveals the continuing push of the largest ETF providers into some of the major markets where they have previously not distributed. With these managers typically offering a very broad range of products, we have seen a sizeable number of new registrations in these markets.”

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