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More than $ 1tn in new currency will be poured in 2021, and ETFs focused on equity-focused ETFs that attract the most influential people in the last weeks of the year even concerns about the variability of the Omicron coronavirus weigh on Investor confidence.
Total revenues of ETFs (funds and assets) reached $ 1.14tn at the end of November, compared to the annual proceeds of $ 762.8bn collected throughout 2020, according to ETFGI, a London data analyst.
The increase took the global ETF earnings below the $ 9.92tn level at the end of the month, meaning that the increase is expected to exceed the $ 10tn mark for the first time in December.
The past few months have often provided the strongest months in the new business for ETF providers, especially when the US stock market has he urged until the end of the year.
“In addition to the large number of registered ETFs in the US and Europe, we have seen a significant increase in new categories such as active and efficient ETFs. environment, culture and leadership [ESG] ETFs. These are areas that stimulate future growth as ETFs penetrate deep into global financial markets, “said Deborah Fuhr, ETFGI founder.
Fast-moving ETFs recorded $ 126bn in the first 11 months of 2021, compared to $ 91.1bn collected last year. ESG’s new ETF-target business has reached $ 146.8bn following a 2020 record of $ 86.9bn per year.
BlackRock, the world’s largest asset manager, predicts that ETF global revenue will reach $ 15tn by the end of 2025.
Salim Ramji, global head of iShares and index Investments at BlackRock, said the growth of free ETFs on digital platforms has contributed to the establishment of ETFs.
“Millions of people around the world can now access ETFs for free on major financial platforms in more than a dozen countries, often using mobile phones,” Ramji said.
Interest growth in ETFs has grown since the end of March 2020 after the turmoil triggered by the coronavirus forced the Federal Reserve and other leading banks to invest in the financial markets through a number of procurement mechanisms.
Opinions of the US domestic equity company ETFs registered a record $ 538bn since the market declined in March 2020, which helped make the S&P 500 meeting a high for December.
Not all viewers receive changes to ETFs. Michael Green, an expert at Simplify Asset Management, said the huge economic growth that follows the ETFs is causing problems by raising volatility, increasing individual stock exchanges and disrupting stocks in the US equity market.
He warned that the risk of “very low results” is increasing as investors continue to pour money into the US stock market through ETFs.
Vanguard, the world’s second-largest treasurer, warned that the US stock market had not become more expensive since the dotcom explosion in the early 2000s.
It was expected that the US economy would grow at a slower rate as interest rates rise due to higher inflation and a slowdown in U.S. corporate profits. As a result, Vanguard predicts that annual returns to US equity over the next decade will drop to 2.3 percent and 4.3 percent.
“This is less than the 10.6 percent annual return [for US equities] has been in the last 30 years, “says Joseph Davis, Vanguard’s global economist.
In contrast, Michael Arone, a business expert on State Street’s ETF in the US, said Wall Street’s market base would “remain strong” by 2022.
Predictability that was agreed upon by Wall Street on the economic growth of S&P 500 companies in 2022 is moving about 8 percent. “When the actual revenue comes close to what is predicted, it may be enough to raise US stocks,” Arone said.