RIAs are the biggest single driving force behind the growth of ETFs and, together with broker-dealers, account for almost half the $2.6 trillion in U.S. ETF assets, according to Broadridge.
— (Related on ThinkAdvisor: ETF Investing Strategies to Use Now: BlackRock’s Richardson)
Its fourth quarter 2016 Fund Distribution Intelligence report shows that RIAs were overseeing almost $700 billion in ETF assets by the end of last year while independent B/Ds were responsible for $514 billion.
— (Related on ThinkAdvisor: Asset Managers Struggle With Outflows, Fee Compression)
What Your Peers Are Reading
“It used to be that institutional investors were driving the growth of passive investments. Now advisors moving to fee-based low-fee products within portfolios are responsible,” says Frank Polefrone, senior vice president of product development at Access Data, the data analytics group at Broadridge. “Robos are a big part of this.”
For all of 2016, net new assets of ETFs rose by $405 billion, up 18.4% from the previous year. RIAs were responsible for just over one-quarter of those money flows, or $116 billion, which were up 20% from the previous year.
— (Related on ThinkAdvisor: Active Managers’ Struggle to Maintain Assets)
Total flows into passive assets – including index mutual funds – from third party channels rose 20% to $610.7 billion in 2016, while flows into active assets increased less than 2%, or $113.2 billion.
Retail channels were responsible for two-thirds of the flows into passive assets; institutional channels accounted for the rest.