Europe’s exchange-traded fund industry grew by 25% in 2010, according to a new report from BlackRock, the parent company of iShares.
Assets under management in ETFs across the region increased from US$227 billion to US$284 billion during the year, says BlackRock. Assets invested in other exchange-traded products (primarily commodity trackers that are structured as debt instruments, rather than funds) grew at a faster rate, from US$15.7 billion to $31.3 billion.
For the first time in several years the European ETF market grew at a slightly slower pace than the US ETF market, where assets increased by 26% in 2010 (from US$706 billion to US$891 billion). In the US market, however, trackers of single commodities are typically structured as funds, muddying the comparison somewhat.
All the same, the growth rate of Europe’s ETF market is clearly slowing from the break-neck pace of its early expansion. Between 2005 and 2009 inclusive, assets under management in the region’s ETFs increased at a compound annual growth rate of nearly 50%.
The European ETF providers with the largest absolute 2010 increase in funds under management were iShares (US$16 billion), db x-trackers (US$10.7 billion), Lyxor (US$6.8 billion), Credit Suisse (US$6.0 billion) and ZKB (US$5.1 billion).
Measured in percentage terms, of the largest ten providers UBS grew its ETF asset base the most last year (by 86%), followed by ZKB (76%) Credit Suisse (62%), Amundi (50%) and Commerzbank (38%).
Europe’s two largest ETF providers, iShares and Lyxor, saw their market share shrink slightly, while db x-trackers saw a small net gain in its overall market share. db x-trackers overtook Lyxor briefly in Europe’s ETF assets under management table during the autumn, only for Lyxor to regain its second place by year end.
Of the top ten European ETF providers, ranked by funds under management at year-end, two saw an absolute loss of assets during 2010: ETFlab and EasyETF, both of which shed US$ 300 million.
Out of 39 European ETF providers, the top three (iShares, Lyxor and db x-trackers) account for 71.1% of the region’s assets under management, BlackRock points out.
By asset class, net new assets in 2010 were focused on equity ETFs/ETPs (US$31 billion in new assets) followed by commodities trackers (US$9.4 billion) and fixed income (US$8.3 billion).