From the June 2011 issue of Investment Advisor • Subscribe!

June 1, 2011

Exchange-Traded Products Hit Record $1.13 Trillion in April: IndexUniverse

‘It’s only a matter of time before SPY becomes a $100 billion fund’ report says

April’s rally in domestic and international stocks contributed to a record $1.13 trillion in U.S.-listed exchange-traded products (ETPs), with assets rising 5.4% for the month, or flows of more than $22 billion, IndexUniverse.com reported Monday.

The SPDR S&P 500 ETF (NYSE Arca: SPY), the world’s biggest exchange-traded fund (ETF), sucked in $2.75 billion in April, more than any other fund, according to data compiled by IndexUniverse.

“It’s clear by now that it’s only a matter of time before SPY becomes a $100 billion fund,” the IndexUniverse news release said.

Year to date, assets in U.S.-listed ETPs have jumped almost 13% from nearly $1.01 trillion at the end of 2010, reported IndexUniverse, which bills itself as the leading independent authority on ETFs, indexes and index funds. IndexUniverse.com and its publications cover product and market developments related to index funds, ETFs and index derivatives.

IndexUniverse pointed to unrest in the Middle East and the Federal Reserve’s low rate policy to explain stocks’ strong performance in April. In addition, investors pulled money out of bond funds in anticipation of a reverse of the Fed’s accommodative money policy.

Investor uncertainty about the Middle East has helped to propel gold futures to a record, cementing SPDR Gold Shares (NYSE Arca: GLD) as the second-biggest U.S.-listed ETF after SPY, IndexUniverse reported. GLD gathered almost $900 million in April, ending the month at $60.68 billion.

The April IndexUniverse league tables show that the biggest ETF company in the world, BlackRock’s iShares, bested the No. 2 and No. 3 firms, State Street Global Advisors and Vanguard, in asset-gathering in April. iShares added almost $9 billion in new assets, while SSgA and Vanguard gathered $5.28 billion and $2.81 billion, respectively.

Meanwhile, the futures-based United States Oil Fund (NYSE Arca: USO) was the last month's least-popular ETF as investors pulled money out of a number of energy funds. Bond funds were also among the biggest losers in April, with the iShares Barclays 20+Year Treasury Bond Fund (NYSE Arca: TLT), suffering redemptions of $191.7 million.

Read “Small Firms Outpace Larger Firms in AUM Growth” at AdvisorOne.com.

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