U.S. Mutual Fund Assets Continue Downward Slide for the Third Straight Month
FOR IMMEDIATE RELEASE
May 2018, Boston. The May 2018 issue of The Cerulli Edge - U.S. Monthly Product Trends Edition analyzes mutual fund and exchange-traded fund (ETF) product trends as of April 2018. This issue also examines high-net-worth (HNW) investors’ interest in low-cost products and addresses the growing demand for strategic beta products.
Highlights from this research:
- Mutual fund assets slid downward for the third straight month, dropping 0.2% in April to close with assets totaling just more than $14.5 trillion. While the mutual fund asset slide continued into April, ETFs reversed course during the month, increasing total assets by 1.2%. Propelling assets forward were net flows of $28.9 billion, which equate to 0.8% organic growth.
- Across all affluent-focused advisory practices, which have a core focus of $2 million or greater, Cerulli finds that almost one-third (29%) of client assets are allocated to passive strategies. HNW-focused registered investment advisors (RIAs) continue to be the largest adopters of ETFs, with 93% of active and passive asset managers citing demand.
- Advisors reported that strategic beta would grow from 17% of their allocation to ETF products in 2017 to 22% over the next two years. This is significant as ETFs continue to make up a growing part of client portfolios. Though ETF issuers tend to position strategic beta as a diversification tool and alpha generator, the primary reason financial advisors report choosing them is to mitigate risk in client portfolios.
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