Assets in ETF managed portfolios increased in the first quarter of 2017.
Morningstar released its latest ETF Managed Portfolios Landscape Report, an update on the industry through the first quarter of 2017.
The report considers “ETF managed portfolios” as investment strategies that typically have more than 50% of portfolio assets invested in exchange-traded funds and report strategy information to Morningstar. Primarily available as separate accounts, these portfolios represent “one of the fastest-growing segments of the managed-account universe,” according to Morningstar.
At the end of March, strategies in Morningstar’s database had collective assets under management and assets under advisement of $99.7 billion. This was a 17.6% rise from the previous quarter. Morningstar currently tracks 950 strategies from 169 firms.
Professional money managers are packaging portfolios of ETFs into investment strategies to meet a wide array of investor and advisor demands, according to the report.
“The fiduciary standard continues to move forward as the baseline philosophy for managing client portfolios, and, as a result, growth in the fee-based model is tilting portfolios toward lower-cost, broad-based investments for a larger part of client portfolios, with a focus on asset allocation,” the report states.
Though organic growth in this space perked up after having stalled in the final quarter of 2016, approximately $8.8 billion of the $14.9 billion quarter-over-quarter growth was attributable to the addition of new strategies to Morningstar’s database, according to the report.