HanEtf has seen investments into thematic ETFs soar in 2021, with US$1bn flowing into investment themes such as ecommerce, cloud tech, medical cannabis and travel.
The investment platform, which enables the ‘white-listing’ of exchange traded funds, increased its AUM by 97% last year.
Hector McNeil, co-chief executive officer of HanEtf, said the burgeoning popularity of thematic ETFs was a result of Global Industry Classification Standard (GICS) sectors failing to access new, emerging themes.
“Take e-commerce - many online retailers will be classified as either consumer discretionary or consumer staples.
“An ETF tracking one of these sectors will fail to provide you with targeted e-commerce exposure and instead leave you with high exposure to a lot of stocks that are not part of the theme.
“Thematic ETFs have provided investors with a solution, by knitting together stocks from various sectors. This provides much more targeted exposure in a way that previous sector-based approaches couldn’t.”
HANetf added 11 new thematic ETFs in 2021, offering 25 in total as the group’s total AUM hit US$2.2bn.
The most successful thematic ETF under HAN is a Medical Cannabis and Wellness UCITS ETF, with a Net Asset Value (NAV) of US$9.48mln, while its largest is an Airlines, Hotels and Cruise Lines ETF, holding $US40.5mln in AUM.
HAN’s performance reflects an increasingly popular thematic ETF market that promises to continue its growth.
Assets in thematic ETFs rose 19.7% to US$437mln last year, with net inflows of US$80.54bn the second highest on record.
Research by PwC has tipped thematic ETFs to be the fastest growing area of the European market over the next three years.
In the study, 82% of European respondents said they expect thematic ETFs to be the biggest growth area over the next three years, compared to 68% of those surveyed in 2020.