July marked the first month of H2 2019 and saw the Australian ETF industry benefiting from both significantly high net flows and positive market performance.
The Australian ETF market grew $2.4bn (4.7%) for the month to $53.2bn, according to BetaShares' July ETF report. This is another record high for the Australian market cap which has grown 33% ($13.3bn) over the last 12 months and means the industry is on track to reach its forecasted $55bn by year's end.
Approximately 60% of the month’s growth came from net inflows which contributed a record high of $1.5bn.
BetaShares launched two products last month, its BetaShares Australian Government Bond ETF (AGVT) and BetaShares FTSE 100 ETF (F100). The issuer has also launched another ETF in the early days of August with the listing of its India ETF following a partnership with German index provider Solactive.
The top performers for the period were unhedged physical metal products such as silver and platinum. This is a result of escalating tensions in the China and US trade war which has caused investors to seek haven in commodities.
With that being said, international equities was the asset class with the largest inflows for the month having received $432.5m. Just behind was fixed income ETFs which received an inflow of $405m. Australian bonds in particular were a popular fixed income sub-category have received $362m in inflows.
The only category to face negative net flows were currency ETFs which suffered $16.8m in outflows. This was limited to the selling in US dollar ETFs as the Australian dollar fell 1.7%.