US investors continued to pile into exchange-traded funds last month, driving total assets under management in the category to a new high of more than $3.6trn (£2.58trn, €2.93trn), “on the back of 6.1% month-over-month growth”, according to the latest data from Cerulli Associates.
The growth in the ETF sector came as US investors added a net total of $51.3bn to their mutual funds holdings in January, which, the Boston-based research group noted, was the highest monthly figure in more than three years.
Asset growth came in at 3.4%, “surpassing the $15trn threshold”, Cerulli said.
Inflows to the ETF sector during the month surpassed $76bn, representing 2.2% organic growth, according to Cerulli.
The findings were contained in the February issue of Cerulli’s monthly product trends publication, The Cerulli Edge.
Other key points in the issue:
• Retail wealth managers can, Cerulli believes, “learn from the institutional market’s focus on objectives and portfolio risks”. Such asset managers “can package multi-asset-class investments as a way to address specific risks in retail investor portfolios,” it notes, adding that “many asset managers are looking to multi-asset-class investments as a way to reestablish their competitive position, relative to passive investments”.
• While passive investment may be attracting the headlines and much of investors’ discretionary spending, most advisers (81%) “agree that active managers are ideal for certain asset classes”.
According to Cerulli, “across all channels, advisers reported that actively-managed ETFs make up 11% of their allocation across both active and passive products”.
While this might seem a “small sleeve of adviser portfolios”, it is, Cerulli points out, important to note that this allocation persists, even among larger practices.