2023 was a good year for the ETF industry and ETF trading on Xetra, and the signs are also green for 2024.
2. January 2023. FRANKFURT (Börse Frankfurt). Brisk trading, high acceptance, new products and providers - according to ETF traders, the major ETF trends from 2023 are likely to continue in 2024. "ETFs will continue to grow in popularity and the product range will continue to diversify," explains Frank Mohr from Société Générale. Leo Puschmann from Lang & Schwarz expects continued intensive trading, especially in ETFs that track the major indices, i.e. MSCI World, S&P 500 and Nasdaq 100 ETFs.
In terms of the product range, Mohr predicts even more new products, especially in the bond segment. In 2023, 240 ETFs were newly admitted to Xetra (by the end of November). This means a total of 2,125 ETFs were listed at the end of November.
Even more ETFs with a maturity date
There was a real innovation in the bond sector in 2023: iBonds from iShares, the first ETFs with a fixed maturity date. These were also really well received. "This will probably continue, we expect demand to remain high," says Puschmann. iShares launched the products on the market in August, followed by Xtrackers' own variants in November. A total of 19 ETFs with maturities between 2025 and 2033 are now available on Xetra.
Puschmann also assumes that the high demand for money market ETFs from the last few months of 2023 will continue. The Xtrackers II EUR Overnight Rate (LU0290358497) was particularly popular, but according to the ETF traders, the Lyxor Euro Overnight Return (FR0010510800) and the iShares EUR Ultrashort Bond (IE00BCRY6557) were also well received.
Even more ETFs with a maturity date
There was a real innovation in the bond sector in 2023: iBonds from iShares, the first ETFs with a fixed maturity date. These were also really well received. "This will probably continue, we expect demand to remain high," says Puschmann. iShares launched the products on the market in August, followed by Xtrackers' own variants in November. A total of 19 ETFs with maturities between 2025 and 2033 are now available on Xetra.
Puschmann also assumes that the high demand for money market ETFs from the last few months of 2023 will continue. The Xtrackers II EUR Overnight Rate (LU0290358497) was particularly popular, but according to the ETF traders, the Lyxor Euro Overnight Return (FR0010510800) and the iShares EUR Ultrashort Bond (IE00BCRY6557) were also well received.
More and more active ETFs
Mohr also expects even more active ETFs to come onto the market. It is firmly assumed that the takeover of Rize ETF by US star investor Cathie Wood's holding company Ark Invest means that the Wood ETFs, which are popular in the USA, will soon also be available in Europe. Active ETFs are still a niche market, but one that is growing rapidly. A total of 116 active ETFs are now available on Xetra.
According to traders, the popularity of technology ETFs is also likely to continue. "This is likely to continue," says Puschmann. In 2023, the technology sector was almost const
ESG ETFs already have a 40 percent share
The trend towards sustainable ETFs is also unbroken, according to the traders. "Demand is mainly coming from private investors, while institutional investors have their own criteria," says Mohr. Of the approximately 240 new ETFs on Xetra, 156 were classified as ESG at the end of November. In total, ESG ETFs accounted for over 40 percent of all ETFs on Xetra.
As far as the number of ETF issuers is concerned, growth also looks set to continue. "More providers are likely to come onto the market, including smaller ones with special approaches," says Mohr. In 2023, the number of ETF issuers on Xetra had risen to 32. New since last year: abrdn, KraneShares and CASE Invest.
ETFs as the new savings account
Another trend that is likely to continue is the popularity of ETF savings plans. "ETF savings plans have become particularly established among the younger generation," notes Mohr.
According to a study conducted by ETF portal extraETF in September, the number of ETF savings plans in Germany has almost doubled year on year over the past four years. By the end of 2023, the authors expected 7.6 million ETF savings plans per month in continental Europe - with a savings volume of around 15 billion euros. "By the end of 2028, we see the continental European market for ETF savings plans growing to 32 million monthly ETF savings plans. The annual savings volume of these ETFs will then amount to EUR 64.3 billion."
By Anna-Maria Borse, 2. January 2024 © Deutsche Börse AG
Mohr
Anna-Maria Borse is a financial and business editor specializing in the financial market/stock exchange and economic topics.
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