Exchange-traded funds continued their surge in the second quarter of 2015, driven almost exclusively by the retail investment market and fee-based RIAs who can deploy low-cost solutions without affecting their revenues.
ETF assets increased in value by $265 billion over the second quarter in 2014, outpacing the $200 billion in growth in long-term mutual funds, according to Broadridge Financial Solutions, a provider of investor communications, data and technology products for asset managers and public companies.
More than 87% of ETF growth for the year ending at the end of June came from retail channels. More ETF assets — $496 billion — were distributed through RIAs over the year than through any other channel.
Total ETF assets distributed through the wirehouses were $397 billion.
Total assets under management in ETFs saw an increase of 14%, compared to an increase of 6 percent for assets in long-term mutual funds.
The RIA channel was also tops for new assets in long-term mutual funds, as fee-based advisors added $130 billion in new mutual fund assets over the year ending in June.
But while ETF assets in all channels were up 21%, or $70 billion, mutual funds’ growth was a paltry $6 billion, or 0.5%.
In the first quarter of this year, ETF assets sold through retail channels surpassed those of long-term mutual funds for the first time. Total ETF assets stood at about $2.19 trillion at the end of the first quarter.