ETFs Swell Across the Globe in '03

January 5, 2004 ( - Globally, asset under management in exchange-traded funds (ETF) were up 49% in 2003.

With 2003’s asset inflow, ETFs saw total assets under management swell to $211 billion, data from Morgan Stanley revealed.   Morgan Stanley attributed much of ETFs success to the broad-based equity market rally combined with late-trading and market-timing scandals that rocked mutual funds (See Keeping Up With the Trading Scandal ), according to a Reuters report.

While the United States remained the number one market in terms of total assets under management, with $150.7 billion, great strides were made in other markets last year.   Europe’s total assets invested in ETFs increased 83% to $19.5 billion, and Japan’s ETF assets rose by nearly a third to $27.6 billion.  

Additionally, trading volumes in ETFs were on the rise last year.   The average daily volume was up 19% to 170 million shares globally.

An exchange-traded fund is an investment company with shares that trade intraday on stock exchanges at market-determined prices. Investors may buy or sell ETF shares through a broker just as they would the shares of any publicly traded company (See  Black Box: Exchange-Traded Funds ).