ETP assets grew by 11.2% in the first half of 2012

Inflows amounted to $72 billion

ETF, coins ETF, coins

US ETP assets recovered 3.7% MoM in June, back above 10% YTD.

ETP assets in the US rose by $41.4bn to $1.16 trillion last month, boosting AUM growth back to the double-digit territory (11.2%) in the first half of the year.

Global ETP industry assets rose to $1.59 trillion, or 10.5% up YTD.

Mixed trends suggest range-bound market

  • US ETP flows experienced inflows of $12.1bn during June (+$72.3bn, 6.9% of last year’s AUM).
  • Within long-only ETPs, total flows were +$11.6bn in June vs. +$5.0bn in May.
  • Equity, Fixed Income, and Commodity long-only ETPs experienced cash flows of +$5.1bn, +$5.1bn, and +$1.5bn, respectively.
  • June turned out to be a very fluid month for risky assets as the European Sovereigns continued to muddle through the financial crisis and US economic data continued to disappoint. However, things become less pessimistic towards the end of the month and the bottom line turned positive for risky assets.
  • A closer look at the new equity and fixed income allocations, however, suggest that investors have been rather cautious and have not displayed clear signs of a new trend yet, either bullish or bearish. For example, equity allocations favored safer bets such as relatively stronger economies (e.g. the US), and diversified regional exposures (e.g. broad EM and DM ex US) rather than country allocations. In the meantime, new fixed income flows were concentrated on corporate debt products, but heavily inclined to the investment grade segment. And on the commodity space, flows were mixed between safe-haven (e.g. precious metals) and growth-driven (e.g. energy) sectors.
  • Some of the relevant flow trends of the month were: (1) US equity (+$4.0bn), (2) Investment Grade debt (+$3.3bn), and (3) Corporate debt (+$3.3bn).

New Launch Calendar: expanding investors toolbox

  • There were 10 new ETPs and 1 new ETN listed during the previous month. All of the products were listed in the NYSE Arca. The new products cover multiple asset classes such as equity, fixed income, Commodity, and Currency (See figure 20 for more details)
  • Floor activity dropped by 10% driven by receding volatility
  • Total monthly turnover dropped by 10.1% to $1.31 trillion vs. $1.46 trillion in the previous month.
  • US ETP trading made up 29.5% of all US cash equity trading in June, down from both its August 2011 peak of 37.5% and its 3-year monthly average of 30.0%.
  • The largest drop was on Equity ETP turnover, which fell by $144bn or 11.1% to $1.15 trillion, followed by Commodity products turnover which shrank by $3.6bn, totaling $68bn for the month of June. Meanwhile, Fixed Income ETP turnover slightly rose by $0.8bn to $82bn last month.
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