ETF Stats For December 2015: Actively Managed ETF Assets Overtake ETNs

Assets in actively managed ETFs climbed 3.3% to $22.9 billion in December, while assets in ETNs dropped 4.5% to $21.5 billion. This is a significant milestone for actively managed ETFs, marking the first time that their asset levels have surpassed those of ETNs. Overall U.S. industry assets shrunk 1.1% in December to end the year at $2.12 trillion, producing a 6.0% one-year growth.

December saw 23 new introductions and two closures. The month and year ended with 1,845 U.S.-listed products, consisting of 1,644 ETFs and 201 ETNs. For the year, the 284 launches and 101 closures resulted in a net increase of 183 products.

Product quantity and asset levels have historically tracked relatively closely at about $1 billion in assets for every ETF.Calendar year 2015 ended with an average of $1.15 billion per product, down from $1.20 billion a year ago.

The quantity of actively managed ETFs increased by only 9.6% during 2015, growing from 125 to 137. This belies the 33.0% surge in assets, which shot from $17.3 billion to $22.9 billion.As mentioned earlier, this is the first time actively managed ETF assets have been greater than ETN assets, even though ETNs outnumber actively managed ETFs 201 to 137.

Fund-of-fund ETFs also saw growth in 2015, increasing from 44 to 77 with assets surging to $14.8 billion (an increase of more than 224%).Much of 2015’s growth was spurred by new currency-hedged international ETFs, which buy an unhedged ETF and then add a currency overlay. Although the 77 fund-of-fund ETFs are included in the industry product counts, their reported asset levels are excluded.If they were included, it would result in double counting because the assets in these ETFs are already reflected in the asset levels of the funds they purchase.

The quantity of funds with more than $10 billion in assets decreased from 52 to 51 for December, but this tiny 2.8% of the products hold 59.4% of the assets. The number of products with at least $1 billion in assets increased by two to 256, and they account for 89.9% of the assets.Just 814 ETFs and ETNs can claim an asset level above $100 million, a level some analysts believe is required for profitability, leaving 1,031 (55.9%) in a questionable state.

Trading activity surged 38.9% in December to $1.86 trillion.This represents a turnover ratio ($ volume / industry assets) of 87.8% for the month. There were 13 funds averaging more than $1 billion in daily trading during December, and they accounted for 57.6% of the industry trading activity. The quantity of ETFs and ETNs with more than $100 million in average daily dollar volume was 107, and 364 posted more than $10 million in daily trading activity. Liquidity remains a concern for many products, with 236 not trading on the last day of the year and 19 going the entire month with zero volume.

December 2015 Month End ETFs ETNs Total
Currently Listed U.S. 1,644 201 1,845
Listed as of 12/31/2014 1,451 211 1,662
New Introductions for Month 23 0 23
Delistings/Closures for Month 2 0 2
Net Change for Month +21 0 +21
New Introductions 6 Months 153 8 161
New Introductions YTD 272 12 284
Delistings/Closures YTD 79 22 101
Net Change YTD +193 -10 +183
Assets Under Mgmt ($ billion) $2,097 $21.5 $2,118
% Change in Assets for Month -1.0% -4.5% -1.1%
% Change in Assets YTD +6.3% -20.2% +6.0%
Qty AUM > $10 Billion 51 0 51
Qty AUM > $1 Billion 251 5 256
Qty AUM > $100 Million 778 36 814
% with AUM > $100 Million 47.3% 17.9% 44.1%
Monthly $ Volume ($ billion) $1,786 $74.0 $1,860
% Change in Monthly $ Volume +38.8% +41.5% +38.9%
Avg Daily $ Volume > $1 Billion 12 1 13
Avg Daily $ Volume > $100 Million 100 7 107
Avg Daily $ Volume > $10 Million 348 16 364
Actively Managed ETF Count (w/ change) 137 +2 mth +12 ytd
Actively Managed AUM ($ billion) $22.9 +3.3% mth +33.0% ytd
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Disclosure: Author has no positions in any of the securities, companies, or ...

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