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Survey: ETFs Will Continue to Grow Despite Recent Outflows, Closures


Recent outflows from ETFs and product closures are just speedbumps in a global $2 trillion business that will continue to grow and challenge traditional mutual funds, according to financial professionals.

In survey results published Tuesday, Ignites.com revealed that over half of respondents believe the number of ETFs on the market is simply correcting itself.

The Financial Times reported a record 117 ETFs have closed in the first half of this year. Also, of the nearly 5,000 exchange traded products on the market, over 60% have less than $100 million of assets. [More ETFs Closing as Industry Consolidates]

Meanwhile, U.S.-listed ETFs experienced outflows of nearly $12 billion in June to snap a 16-month streak of consecutive monthly inflows, according to Dow Jones Newswires.

“Is the tide turning for ETFs, in that they will start to lose market share to other products?” the Ignites survey asked.

According to the results, 53% of respondents said recent ETF closures are a simple correction, while 22% said to look for more ETF launches and greater inflows.

Conversely, in the “yes” category, 12% said the tide is turning and that ETFs are just a fad and now the hype is dissipating, while 13% said ETFs’ inflows streak could not last forever, Ignites reports.

The opinions and forecasts expressed herein are solely those of John Spence, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.