The Australian Exchange Traded Fund (ETF) market grew 37.9% over the past year to $196.6 billion across 358 products. This was driven by over $18.5 billion in net inflows, positive market movements, and numerous unlisted active funds converting into active ETFs.
In its March 2024 ETF Market Report, Global X ETFs explores prevailing trends within the ETF market, providing comprehensive insights into:
- Highest and lowest-performing ETFs
- Cryptocurrency and Technology ETFs were the best performing ETFs over the past year, driven by the launch of spot bitcoin ETFs in the US (a model already in place in Australia) and anticipation of the notable upcoming bitcoin halving cycle. Global X is currently the only provider of a spot bitcoin ETF in Australia through our Global X 21Shares Bitcoin ETF (EBTC) which returned +168% over the past 12 months.
- Technology ETFs continue to surge driven by the consistent theme of artificial intelligence (AI) innovation and a potential softer economic landing.
- Energy transition and clean energy ETFs have remained the poorest performers, weighed down by higher interest rates which impacted borrowing costs given their long project timelines and higher reliance on debt.
- Most and least popular ETFs (by net flows)
- The majority of net flows were directed toward low-cost vanilla ETFs with three of the lowest cost Australian share ETFs (VAS, IOZ and A200) garnering in a total of $4.3 billion in net flows over the past year.
- The bulk of the outflows were from active ETFs which, despite accounting for the majority of new ETF listings, are still seeing money leaving their funds.
- Feature Insight: Thematic ETFs Signs of Resurgence
- Thematic ETFs have been a key innovation in the ETF industry, enabling investors to gain exposure to specialised global megatrends. There are now ~40 thematic ETFs available in the Australian market for investors to choose from, with a total of $5.4 billion of Australian investor money within them.
- Global X ETFs anticipates ongoing product innovation within thematic ETFs and increased use by investors as satellite exposures in their portfolios, allowing them to express tailored investment perspectives.
