It's well known that the ASX exchange-traded fund (ETF) is an investment vehicle that seems to grow more popular by the day. Offering an accessible and relatively cheap way to invest in entire indexes, ETFs have been around for a while. But this vehicle has really hit its stride over the past few years in particular.
Back in December last year, the Motley Fool covered what was then a record-breaking month of November for ASX ETFs. At the time, we reported that funds under management grew by $4.9 billion over November 2020. That was a new monthly record at the time. We also saw ETFs rise to represent a market capitalisation of $78.7 billion. This was boosted even further to $92.3 billion by the conversion of the sizable Magellan Global Fund (ASX: MGF) to an actively managed 'open class' ETF.
Over that month, ETFs also saw a record monthly inflow of $2.5 billion.
Well, fund-provider BetaShares has just released its July 2021 Australian ETF Review. And it seems that momentum is only increasing for the industry.
BetaShares' report tells us that the month of July 2021 saw ASX ETFs once again break the all-time record for fund inflows. A whopping $2.8 billion made its way into exchange-traded funds over the month. The previous record of $2.7 billion was made in December 2020. Of that $2.8 billion, 90% came from inflows, with only 10% coming from market appreciation.
This also helped push the total market cap for ASX ETFs to a record $118.8 billion. That's pretty substantial growth from November's $92.3 billion.
Which ASX ETFs were the standout performers?
The BetaShares report also gives us some interesting insights into which funds are giving investors the best bang for their buck. It names healthcare, followed by cybersecurity and ASX resources shares, as being some of the best performing sectors over July.
In terms of raw inflows, the report names ETFs covering international shares as being ASX investors' top choice over the month. $1.6 billion found its way into international ETFs. That was around 4 times more than the next category (Australian shares).
BetaSahres also found that 65% of new ETF inflows over the month ended up with just two ETF providers (out of 31). They were BetaShares itself and Vanguard. The top ETF recipient of these inflows was the Vanguard MSCI Index International Shares ETF (ASX: VGS). This ETF received ~$228.3 million in funds over the month. This was followed by the Vanguard Australian Shares Index ETF (ASX: VAS), which received roughly $178 million. Close behind was the BetaShares Nasdaq 100 ETF (ASX: NDQ) with $126.8 million. And the BetaShares Global Sustainability Leaders ETF (ASX: ETHI) with $115 million.
