Frequently Asked Questions About the U.S. ETF Market
How big is the U.S. ETF market?
How many Americans own ETFs?
How many U.S. ETF providers are there?
How has demand for ETFs grown?
What are recent trends in demand for global and international equity ETFs?
Where are assets of ETFs concentrated?
As of November 2012, the total number of index-based and actively managed exchange-traded funds (ETFs), including commodity ETFs, domiciled in the U.S. stood at 1,193 and total net assets of these ETFs were $1,295 billion. Find ICI’s latest ETF stats at ICI’s Exchange-Traded Funds Resource Center.
An estimated 3.4 million, or 3 percent, of U.S. households owned ETFs in 2012. Of households that owned mutual funds, an estimated 6 percent also owned ETFs.
As of November 2012, 36 sponsors provide ETFs as an investment product.
Demand for ETFs has accelerated as institutional investors have found ETFs a convenient vehicle for participating in, or hedging against, broad movements in the stock market. Retail investors and their financial advisers have also increased their usage of these investment vehicles.
One way to track investor demand is to look at net issuance of ETF shares. Net issuance refers to the total dollar amount of shares issued/created by an ETF sponsor, less the total dollar amount of shares redeemed by the ETF sponsor. For more on how ETF shares are created and redeemed, see “Frequently Asked Questions About ETF Basics and Structure.”
Investor interest in ETFs has grown rapidly. From year-end 2002 through November 2012, ETFs issued $1,036 billion in net new shares. Investor demand for broad-based domestic equity ETFs accounted for 30 percent of this total. These equity ETFs issued $313 billion in net new shares during this nearly 10-year period, and their assets were $487 billion in November 2012.
Net issuance of ETF shares from January to November 2012 has amounted to $153 billion, outpacing the net issuance during this period last year by $54 billion. Assets in ETFs accounted for 10 percent of total net assets managed by investment companies by the end of November 2012.
Net Issuance of ETF Shares1
Billions of dollars
1ETF data prior to 2001 were provided by Strategic Insight Simfund; ETF data include ETFs not registered under the Investment Company Act of 1940; ETF data exclude ETFs that invest primarily in other ETFs.
22012 total is net issuance of ETF shares from January to November 2012.
Sources: Investment Company Institute and Strategic Insight Simfund
Investor demand for global and international equity ETFs increased in 2004 and remained quite strong through 2010, with these ETFs issuing $223 billion in net new shares.
Global and international equity ETF net issuance moderated in 2011, but has picked back up in 2012. Through November 2012, net issuance of global and international equity ETFs amounted to $37 billion.
Total net assets of ETFs are concentrated in large-cap domestic stocks. As of November 2012, large-cap domestic equity ETFs accounted for the largest proportion of ETF assets—21 percent, or $271 billion. The second-largest category was emerging markets equity ETFs, which accounted for 12 percent ($152 billion) of ETF assets.
Total Net Assets of ETFs1 Concentrated in Large-Cap Domestic Stocks
Billions of dollars, November 2012
1ETF data exclude ETFs that primarily invest in other ETFs.
2This category includes funds both registered and not registered under the Investment Company Act of 1940.
3This category includes international, regional, and single country ETFs.
4The funds in this category invest primarily in commodities, currency, and futures, and are not registered under the Investment Company Act of 1940.
5Bond ETFs represented 99.75 percent of the assets in the bond and hybrid category.