ETF assets are projected to double to more than $2 trillion by the end of 2015, according to a report by BNY Mellon and consultant Strategic Insight.
ETF assets grew by 28% to just more than $1 trillion in 2010, down from the 47% growth rate in 2009. The report estimates a compound annual growth rate of 15.8% through 2015, putting total assets at roughly $2.09 trillion by Dec. 31, 2015.
Roughly half of the U.S. ETF assets are from institutional clients.
Joseph Keenan, head of global exchange-traded fund services at BNY Mellon Asset Servicing, said in a telephone interview that a new “wave of growth” for ETFs is being driven by new asset classes, new indexes and non-traditional ETFs such as commodity, leveraged, inverse, actively managed and hedge-fund-like ETFs.
Non-traditional ETFs have increased to 30% of the ETF market as of March 31, from 18% at the end of 2008, according to the report.
“We believe from our dialogue with clients that this will be a double-digit growth segment for us for the next several years,” Mr. Keenan said.
The report is titled “ETFs 2.0: The Next Wave of Growth and Opportunity in the U.S. ETF Market.”