Some of the exchange-traded fund industry's more recent entrants are building their businesses and even eclipsing the growth rates of its three biggest players — BlackRock Inc., Vanguard Group Inc. and State Street Global Advisors — albeit from much smaller asset bases.
For example, J.P. Morgan Asset Management, which launched its first ETF in 2014 and managed just over $1 billion in by the end of 2016, ended 2021 with $78 billion of ETF assets worldwide, about half in active funds and up 57.4% from a year earlier, data from Pensions & Investments' annual survey of the largest money managers show.
JPMAM's growth rate topped that of Vanguard, which had the highest growth rate of the big three last year and added more than $600 billion in AUM. Vanguard's worldwide ETF assets totaled $2.21 trillion as of Dec. 31, up 38% from a year earlier. SSGA posted a 30.1% growth rate, with $1.18 trillion in assets. BlackRock, which remained by far the world's largest ETF provider, ended 2021 with $3.27 trillion in ETF assets, up 22.4% from $2.67 trillion a year earlier.
Stocks had a "great year" in 2021, which saw the S&P 500 index post a 28.7% total return, providing a tailwind for ETF assets, according to Todd Rosenbluth, head of research at VettaFi LLC, a data, analytics and thought-leadership company. Asset growth results from both net inflows as well as appreciation in underlying assets, which means that an ETF provider's product mix can impact its asset growth rate in years when certain asset classes outperform others, Mr. Rosenbluth said.
While the top-three ETF providers saw "tremendous" growth last year, it was encouraging to see significant growth at firms outside the big three, with some midtier firms "growing at an even faster clip," Mr. Rosenbluth said. Citing P&I's data, he noted that in addition to JPMAM, Fidelity Investments and Northern Trust Asset Management each posted growth rates last year north of 40%.
Fidelity's ETF AUM increased 44.9% to $34.9 billion during the year, while Northern Trust was up 41.2% to $20.1 billion.