Deutsche Bank Markets Research Europe
Synthetic Equity & Index Strategy
European Monthly ETF Market Review
Date
9 November 2015
Authors
Fixed Income Dominates ETF Flows Data in this report is as of 30th October 2015
Anil Gademsetty, CFA Strategist (+44) 20 754-52198 anil-kumar.gademsetty@db.com
Team Contacts European ETP Highlights As of the end of October 2015, global ETP assets stood at $2.9 trillion with European ETP assets at $514bn (€465bn). European ETPs had another good month with net inflows of +€6.4bn in October (+€1.8bn in the prev. month). Fixed Income ETFs led the charge with notable inflows of +€3.5bn followed by Equity ETFs (+€2.5bn) over the last month. Commodity ETPs listed in Europe reversed previous month’s trend and recorded inflows of +€0.4bn during the same period. Global EM, Broad European equities and Energy ETFs benefitted from inflows, Short and Leverage ETFs experienced net outflows Investors trading European-listed ETPs were net buyers of broad emerging market focused ETFs. We observed net demand of +€0.9bn into emerging market equities during October.
Shan Lan Strategist (+852) 22036716 shan.lan@db.com Sebastian Mercado Strategist (+1) 212 250-8690 sebastian.mercado@db.com
European equity exposure ETFs continued the positive run in October and attracted investors from Europe and the US. Where European-listed ETFs were concerned, we observed monthly inflows of +€0.5bn (+€20.6bn YTD inflows) into European equities in Oct’15. US-listed ETFs providing exposure to European equities registered monthly inflows of +$2.3bn bringing YTD total to over +$32.4bn. Investors remained bullish on the Energy sector and put +€0.1bn of new money into Energy-sector ETFs during October (+€0.2bn inflows in Sep’15). Short and Leverage Long focused ETFs lost momentum and experienced outflows of -€0.4bn and -€0.2bn, respectively, over the same period. European ETF flows dominated by Fixed Income ETFs Fixed income ETF flows dominated overall European ETF flows in October recording +€3.5bn inflows vs. the region’s overall inflows of +€6.4bn. Within fixed income, investment grade led the flows, attracting +€2.9bn over the last month (+€20.4bn YTD). High yield bonds reversed previous month’s trend and recorded inflows of +€0.7bn in October (-€0.4bn in September & +€3.9bn YTD). European ETFs Turnover (%) increased into overall Cash Equity Turnover into European ETFs has significantly increased since the start of 2015. ETFs turnover (%) vs. the overall Cash Equity market has increased to 9.1% from 7.6% in 2014.
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