Assets invested in ETFs/ETPs (hereafter ETFs) listed in Europe increased by a record $54.0 billion during January 2018 to reach a new high of $856bn, according to ETF industry consultant ETFGI.

There were $16bn net inflows into Europe-listed ETFs/ETPs during January 2018.

The increase in total assets during the month consisted of $16.0bn net inflows and $38bn growth due to upwards-trending markets. The strong net inflows, 38.2% more than net inflows recorded during January last year, also marked the 40th consecutive month of positive net flows into ETFs listed in Europe.

Equities were the most popular ETF asset category during January with net inflows of $14.0bn. Fixed income ETFs gathered net inflows of $1.7bn. Assets in equity ETFs increased by 8.2% in January, while assets in fixed income ETFs grew 3.3%.

The majority (59.2%) of the record net inflows during January can be attributed to the top 20 ETFs by net new assets, which collectively gathered $9.5bn over the month. The iShares STOXX Europe 600 UCITS ETF (SXXPIEX GY) topped the table with net inflows of $1.3bn. The fund’s underlying index, the Stoxx Europe 600, provides exposure to the largest 600 companies across Europe’s developed markets.

The ETF has $10.0bn in AUM and costs 0.20% in total annual fees. Its relatively low cost and broad market exposure make the fund a good fit for investors seeking core ETFs to use as the foundation for their portfolios. According to ETFGI, the fund’s popularity in January reflected a broader trend of investors favouring core exposure, market cap-weighted and lower cost ETFs during the month.

Top 20 ETFs by net new assets

Source: ETFGI.

The European ETF industry has shown a compound annual growth rate (CAGR) of 19.3% over the past ten years. AUM has accelerated in recent years, however, with January’s increase alone representing 6.7% growth (117% annualised growth). At the current rate, AUM within the European ETF industry is expected to pass the $1 trillion milestone in April 2018.

Source: ETFGI.