Morningstar reports strong growth in ETF Managed Portfolios AUM

Apr 24th, 2018 | By | Category: Alternatives / Multi-Asset

FACTOR INVESTING - THURSDAY 14TH JULY 2022 (08:15-11:30) - THE BERKELEY, LONDON Please join us for our annual factor investing breakfast briefing with participation from MSCI, FlexShares ETFs, Tabula and Professor Stefan Zohren, Deputy Director of the Oxford-Man Institute of Quantitative Finance. Please register now if you would like to attend.


Investment research firm Morningstar has published the latest instalment of its ETF Managed Portfolios Landscape Report. The report, which covers the fourth-quarter of 2017 and tracks 1,180 strategies from 182 US-based firms, found that total assets under management in the ETF managed portfolios segment increased by 7.0% in the period, to $123.0 billion.

Morningstar reports strong growth in ETF Managed Portfolios AUM

Charles Schwab Investment Advisory holds over $12.4bn in AUM across 15 ETF Managed Portfolios strategies.

ETF managed portfolios are investment strategies that typically have more than 50% of portfolio assets invested in ETFs. According to Morningstar, these portfolios represent one of the fastest growing areas of the managed-account universe.

Roughly 80% of the $8 billion quarter-over-quarter increase in assets was driven by the addition of new investment strategies to the Morningstar database.

Invesco, PowerShares’ parent firm, added 28 strategies to its stable of ETF strategies in the fourth quarter after having added 68 in the previous quarter. Many of them feature the firm’s new PureBeta ETFs – plain-vanilla, cap-weighted funds targeting core asset classes.

S&P Investment Advisory Services made its debut this quarter, reporting 16 ETF model portfolios to the database with collective assets of $5.6bn.

Organic growth in existing strategies contributed the remaining $1.6bn in incremental assets over the three-month period.

Assets overseen by the 25 largest firms in this universe saw a collective increase amounting to nearly $8.4bn versus the prior quarter—owing to a combination of organic growth and the addition of new strategies to Morningstar’s database.

Charles Schwab Investment Advisory holds the spot at the top of the mountain with over $12.4bn in AUM across 15 strategies. The other firms in the top five by AUM include Vanguard ($10.8bn across 44 strategies), BlackRock ($7.9bn across 40 strategies), State Street Global Advisors ($6.7bn across 20 strategies), and RiverFront ($6.6bn across 16 strategies).

Vanguard experienced the greatest quarter-over-quarter growth, as assets in its strategies increased nearly $1.7bn. This was despite the fact that approximately $1.4 billion in assets that the firm reported in the third quarter of 2017 were temporarily removed from the database, owing to mergers and acquisitions in the industry.

Twelve of the 20 strategies with the largest quarter-over-quarter percentage increases in assets were plain-vanilla stock/bond strategic asset-allocation portfolios. This marked a continuation in the shift of investor preferences in this space that was spurred by the implosion of a handful of highflying tactical strategies just a few years ago.

Tags: , , , , , , ,

Leave a Comment