For three years, actively managed ETF launches outstripped the passive. However, index-tracking, passively managed ETFs took more control in 2021. While most newly launched ESG, thematic, and crypto-asset ETFs can be used for active purposes, the National Bank notes that this new generation of ETFs track public indices and can be considered passive. .
In terms of total inflows, passive ETFs still hold the largest share. The report attributed the popularity of passively managed strategies to traditional market cap-weighted products, the growing crypto-asset category, and ESG ETFs. Cap-weighted ETFs alone attracted $15 billion in inflows, or 60% of total net inflows within the equity ETF umbrella, placing them at the top of the inflows table, followed by sector, thematic and dividend/income equity ETFs.
National Bank predicts that in 2022, active ETFs will account for more than 40% of total ETFs and will capture a quarter of the market by assets. Drawing from Bloomberg data and its own research, it said that active ETFs made up 29% of the industry by AUM last year, while passive and strategic equity ETFs accounted for 64% and 11%, respectively.
Actively managed equity ETFs, asset allocation ETFs, actively managed bond ETFs and sector-focused ETFs also gained popularity in 2021.
Drawing from Bloomberg’s own research and data as of December 31, 2021, the report states that a total of 202 ETFs were launched in Canada, including both active and passive strategies. With over 100 launches of active strategies, 2020 was the peak for active ETF debuts.