Australia’s ETF market to hit $100 billion by 2022

Australia’s ETF market to hit $100 billion by 2022

Australia’s ETF market has more than doubled in the last 5 years, growing from $17.8 billion to $45.8 billion since 2015.

Exchange traded funds (ETFs) are continuing their meteoric rise in Australia, with the market expected to hit $100 billion over the next 3 years, according to the latest research from robo-advice platform Stockspot. Despite its growth, that figure will make up just 0.6% of the global ETF market, which is predicted to hold $17 trillion by 2023.

According to Chris Brycki, founder of Stockspot, which uses ETFs as its primary investment tool, the growth in the ETF market shows that more people are becoming aware of the benefits of the product.

The company’s annual ETF report found that in the past year, Australians that had invested in ETFs instead of active fund managers had saved $300 million in fees, with that number expected to increase to $660 million by 2022. While actively managed funds typically charge around 1% in fees, ETF management fees are often less than half that cost.

“Considering ETFs still only make up 2% of the share market in Australia, $300m saving is huge. This figure will increase exponentially as more Australian investors gravitate towards these wonderful low-cost wealth building products,” said Brycki.

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