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A coffee table book on ETFs?  I’m considering.  Until then, here are some of my favorite ETF charts so far in 2019.  Enjoy!


Previous “ETFs in Pictures”:

ETF in Pictures I

ETF in Pictures II

ETFs – Year in Pictures 2018


Accelerating ETF Growth

As always, we start with an updated ETF growth chart.  This one is courtesy of Bloomberg’s Eric Balchunas, who observes ETFs are on pace to hit $4 trillion by the end of June.  It took ETFs 18 years to hit $1 trillion, 4 years to reach $2 trillion, 2.5 years to get to $3 trillion, and – if it happens in June – less than 2 years to achieve $4 trillion!

Source:  @EricBalchunas


ETFs Crushing Mutual Funds?

For all of their growth and hype, ETF assets still a fraction of mutual fund assets.

Source:  Alpha Architect’s Ryan Kirlin


But a Deeper Look Tells the Real Story

While mutual funds dwarf ETFs, a long-running bull market has masked investors yanking billions of dollars out of active mutual funds.  The long-term trend is not mutual funds’ friend.

Source:  Investment News


Another Way to Look at It

While active mutual funds have lost market share over the past 10 years as investors have flocked to index funds and ETFs, the overall market pie has grown.

Source:  ICI


Which Means Active Mutual Funds are Still Raking in the Dough…

Source:  @EricBalchunas


…Despite Continued Underperformance

2018 was billed as the “year of the active manager”.  Whoops.  Over the long-term (think 10 or 15 years), 80%+ of active managers across all categories have underperformed their respective benchmarks.

Source:  S&P Dow Jones Indices


Fees Continue Declining…

Since the year 2000, mutual fund and ETF fees combined have dropped by roughly half – the average asset weighted fee in 2000 was 0.93%; in 2018 it was 0.48%. Investors saved an estimated $5.5 billion in fees in 2018 compared to 2017.

Source:  Morningstar


…In Large Part Because Investors are Seeking Out the Lowest Cost Funds

Source:  Charles Schwab


Investors Want the Cheapest of the Cheap ETFs…

More than 95% of net flows in 2018 went to ETFs with expense ratios of 0.20% or less, including a growing portion to those with fees of 0.05% or less.

Source:  Wall Street Journal


…Especially for the Core Building Blocks of a Portfolio

Source:  JPMorgan


Nearly Three-Fourths of Total ETF Assets are in Products Charging 0.20% or Less…

Source:  Nate Geraci


ETF Fee War Reignites

After a relative period of calm which led some ETF industry observers (including yours truly) to declare the fee war over, there was a frenzy of fee cuts during a two-week period earlier this year.  There are now ETFs with zero and even negative fees (after fee waivers)!



Fighting Over Basis Points

While the ETF fee war grabs headlines, most ETF fee cuts are only a basis point or two.  Why?  Because investors have already won the fee war.

Source:  FactSet’s Elisabeth Kashner


Where They Stand Now

Source:  Nate Geraci


ETF Trading Commissions a Battleground Too

Major brokerages continue expanding their lineup of commission-free ETFs, desperate to capture ETF-focused investors.

Source:  @tpsarofagis


Fees Aren’t Everything

An ETF’s construction and underlying exposure is more important than fees.  Other factors such as an ETF’s liquidity should be considered as well.  2018 provided a good example of differences in bid-ask spreads among the most popular S&P 500 ETFs.

Source:  State Street


Taxes Matter Too

According to Barron’s, over the past 5 years, nearly 58% of equity mutual funds paid capital gains compared with less than 6% of equity ETFs.  In 2018, a DOWN year for most assets, 6.2% of all US-listed ETFs paid a capital gain, compared to more than 60% of US mutual funds!  Investors owe taxes on capital gains if these funds are held in a taxable account.

Source:  @StateStreetETFs


Investors Continue Pumping Money into BlackRock’s iShares & Vanguard ETFs…

Source:  Bloomberg TV


…Which is Reflected in ETF Industry Market Share

Source:  Nate Geraci


ETF Terrordome – Vicious Competition Greets New ETFs & ETF Issuers

Bloomberg’s Eric Balchunas refers to the ETF industry as the Terrordome because of the brutal competition.  81% of ETFs launched in 2018 had less than $50 million in assets by the end of the year.

Source:  FactSet’s Elisabeth Kashner


But Unicorns are Real…

Survival in the ETF Terrordome is tough, but not impossible.  Below are the fastest ETFs to hit $1 billion – a chart also known as “Missile Command” after the classic Atari game.

Source:  @JSeyff


The Future of ETFs is Bright…

Source:  Bloomberg


…With Millennials Leading the Way

Source:  Charles Schwab


Still More Education Needed

ETFs have democratized investing, but they haven’t democratized financial and ETF literacy.  Better ETF education will help drive even greater use of ETFs.

Source:  Cerulli