Global ETF AUM Touches $6 Trillion: What Are The Hot Picks?

Amid both peaks and troughs, the ETF industry is seeing explosive growth, courtesy of its unique strategies, creativity, transparency, diversification benefits, enhanced tax competences, low turnover and of course, low cost. Additionally, the novel concepts that issuers are adding to the ETFs are attracting investors (read: Top & Flop ETFs Halfway Through Q4).

Good news is that the industry reached a new high of $6 trillion in AUM. Per EPFR, global ETFs gathered around $840 billion in assets through October since the start of this year. Investors should note that ETF assets hit a new trillion-dollar plateau in each of the last four years and ETFs have grown six-fold since the global financial crisis.

Equity ETFs are a consistent key driver of overall ETF growth. The asset class rose in sharp contrast to the equity mutual funds. In 2002, EPFR reported that equity ETFs held a market share of 0.3% compared with 99.7% held in equity mutual funds. As of the fourth quarter 2019, equity ETFs represent 23.3% of global equity AUM.

This upside was mainly driven by a skyrocketing stock market despite trade deal uncertainty and geopolitical tension. Notably, the plain vanilla and low-cost ETFs have been the biggest crowd pullers (read: The Race to Zero: What ETF Investors Need to Know).

Below, we have highlighted top five asset gatherers so far this year:

Vanguard Total Stock Market ETF (ASX:VTI)

This is a plain vanilla $133.3-billion ETF providing exposure to the broad stock market and is the top asset gatherer year to date. It has amassed $13.7 billion in its asset base and tracks the CRSP US Total Market Index. The fund holds 3611 stocks in its basket and charges 3 bps in fees per year from investors. It has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.

iShares Edge MSCI Min Vol USA ETF USMV

This ETF has raked in more than $12.2 billion in capital, taking its total AUM to $36.5 billion. It offers exposure to 209 stocks with lower volatility characteristics relative to the broader U.S. equity market by tracking the MSCI USA Minimum Volatility Index. The product charges 0.15% in annual fees and has a Zacks ETF Rank #2 (Buy) with a Medium risk outlook.

Vanguard S&P 500 ETF VOO

This $126.9 billion ETF with an expense ratio of 0.03% saw inflows of nearly $12 billion. It ETF follows the S&P 500 Index, holding 510 stocks in its asset base. It has a Zacks ETF Rank of 2 with a Medium risk outlook (read: 10 Best Performing Stocks of S&P 500 ETF).

Vanguard Total International Bond ETF BNDX

This fund has accumulated more than $10.3 billion in the year-to-date timeframe, bringing its AUM to $24 billion. It tracks the performance of the Bloomberg Barclays (LON:BARC) Global Aggregate ex-USD Float Adjusted RIC Capped Index and offers broad exposure to non-US dollar denominated investment-grade bonds. The ETF holds a broad basket of 6117 securities with expense ratio of 0.09%.

iShares Core MSCI EAFE ETF IEFA

IEFA, which offers exposure to a broad range of companies in Europe, Australia, Asia and the Far East, accumulated $71.4 billion in AUM this year so far. It follows the MSCI EAFE IMI (LON:IMI) Index and holds a broad basket of 2470 stocks with expense ratio of 0.07%. IEFA has a Zacks ETF Rank #3 with a Low risk outlook (read: Beyond US, These Foreign ETFs Are at Highs).

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Vanguard S&P 500 ETF (VOO): ETF Research Reports

Vanguard Total Stock Market ETF (VTI): ETF Research Reports

iShares Edge MSCI Min Vol USA ETF (USMV): ETF Research Reports

iShares Core MSCI EAFE ETF (IEFA): ETF Research Reports

Vanguard Total International Bond ETF (BNDX): ETF Research Reports

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Zacks Investment Research