Exchange Traded Funds See Strong Asset Inflows
in First Half of 2010, According to State Street
Global Advisors
July 29, 2010 06:03 AM Eastern Daylight Time
BOSTON--(EON: Enhanced Online News)--Exchange traded fund (ETF) industry assets in the United States
decreased 0.4 percent during the first half of 2010, as investors held $772 billion in 897 ETFs as of June 30, 2010,
according to State Street Global Advisors (SSgA), the investment management business of State Street Corporation
(NYSE: STT). During the same period, equity markets, as measured by the widely followed S&P 500 Index fell,
8.9 percent.
“Despite the market’s performance during the first half of 2010, ETF net inflows are ahead of last year’s pace,” said
Tom Anderson, director of strategy and research for the Intermediary Business Group at State Street Global
Advisors. “This growth has been driven by financial professionals, individual investors and institutions, and
underscores the way investors build and maintain portfolios in every market cycle using these innovative investment
products.”
Three key trends helped shape the ETF industry during the first six months of 2010:
Continued Growth of Fixed Income ETF Assets
The growth of fixed income ETF assets, which increased 78 percent in 2009, remained a key trend during the first
half of the year. Fixed-income ETF assets increased by $21.2 billion or 21 percent in the six months to June 30,
2010, as the number of bond ETFs available to investors reached 105. This growth illustrates the rapid evolution in
the ETF industry in order to meet the needs of investors. In 2006, just six fixed income ETFs existed, representing
approximately $20 billion in assets. In the first half of 2010, six of the 10 ETFs with the highest net cash flows were
bond ETFs.
The growth in bond ETFs was broad based — every category, from corporate bonds to municipal bonds to
Treasury Inflation Protected Securities (TIPs) and US Treasuries, saw positive cash flows year-to-date. The most
popular f