ETF Industry KPI – 1/17/2023

Week of January 9, 2023 KPI Summary

Ryan Fitzgerald

• This week, the industry experienced 7 ETF launches and 1 closure, shifting the 1-year Open-to-Close ratio to 2.91 and total US ETFs to 3,098.
• After highlighting it last week in our 2022 review, we are taking a deeper look into Index performance in the ETF industry, specifically Active funds, which we haven’t dug into since last August.
  • In the past 12-months, Active ETFs have increased their assets by 25.4% and amount of total funds by 30.4% (+241). Meanwhile, Traditional index funds have decreased in assets -5.9% and down 2 funds in total and Non-Traditional (known to many as “Smart Beta”) are also down -4.6% in assets and up 9 total funds.
    • Although the asset market share gain isn’t massive for Active ETFs (from 4.0% to 5.3% over 12-months), the quantity of funds has really affected the industry. The amount of Active funds has more than doubled over a 24-month time period (475 to 1033).
  • The Predicted 12-month Revenue data has also taken a huge swing over the past two years.
    • On 1/17/2021, Traditional Index funds accounted for 51.7% of the predicted revenue, with Non-Traditional at 39.6% and Active with 8.7%. Since then, Traditional index has given up that lead and will likely soon be passed by Non-Traditional funds. Traditional index has 44.6%, Non-Traditional next with 43.1%, and Active rising to 12.3%.
      • Of the total $1.16 Trillion of Predicted Revenue, the difference between Traditional and Non-Traditional is down to just $18.3 Billion.
  • Lastly, we realize the asset data presented for each index is not directly correlated to the funds’ performances. According to our Security Master, Traditional funds are down an average of -7.6% over 12-months, which just edges out the Active index at -7.7%. Non-Traditional funds were hit the hardest by 2022’s downturn and have a 12-month average fund performance of -10.3%.
• The tracked indexes had similar experiences in the past week. The Toroso ETF Industry Index was up 3.29% while the S&P Financial Select Sector Index trailed at 2.05%.

ETF Launches

Gabelli Equity Income ETF (ticker: GCAD)
Hypatia Women CEO ETF (ticker: WCEO)
KraneShares China Internet and Covered Call Strategy ETF (ticker: KLIP)
BlackRock AAA CLO ETF (ticker: CLOA)
Matthews Emerging Markets Ex China Active ETF (ticker: MEMX)
Mohr Sector Navigator ETF (ticker: ENAV)
USCF Sustainable Battery Metals Strategy ETF (ticker: ZSB)

ETF Closures

Viridi Bitcoin Miners ETF (ticker: RIGZ)

Fund/Ticker Changes

None

TETF.Index Performance vs. S&P Financial Select Sector Index
(as of January 13, 2023)

TETF.Index Performance vs. Other Leading Financial Indices
(March 31, 2017 through January 13, 2023)

Source: Morningstar Direct

Why Follow the ETF Industry KPIs

The team at Toroso Investments began tracking the ETF Industry Key Performance Indicators (KPI’s) in the early 2000’s and have been consistently reporting on, and analyzing these metrics ever since. The table above was the impetus for the creation of the TETF.Index, the index that tracks the ETF industry. Each week, we will share the statistics we believe to be the most useful for identifying industry trends, in addition to the performance of the TEFT.Index. 

DISCLAIMER

Past performance is no guarantee of future returns. This article is for informational and educational purposes only; is not intended to constitute legal, tax, accounting or investment advice; and does not constitute an offer to sell or a solicitation of an offer to buy any security or service. Furthermore, the Indexes shown above are not investable. While Toroso has gathered the information presented from sources that it believes to be reliable, Toroso cannot guarantee the accuracy or completeness of the information presented and the information presented should not be relied upon as such. Any opinions expressed are Toroso’s opinions and do not reflect the opinions of any affiliates or related persons. All opinions are current only as of the date of initial publication and are subject to change without notice. All investment strategies and investments involve risk of loss, including the possible loss of all amounts invested.