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Total worldwide assets managed in sponsored exchange-traded funds soared 23.5% to $1.92 trillion as of Dec. 31, according to the latest Pensions & Investments money manager survey.
It is the second straight year that sponsored ETF assets have jumped more than 20%; they jumped 27.4% to $1.55 trillion in 2012, according to P&I data.
John Plainer, New York-based senior investment consultant at Towers Watson & Co., said in a telephone interview that the attraction of exchange-traded funds for institutions, in particular, also is growing, particularly as a shorter-term investment.
"From an institutional perspective, they're appealing in their liquidity ... if a sponsor is seeking a shorter-term exposure, whether it (is) through some sort of a transition process or just looking to get the shorter term exposure," Mr. Plainer said. "They're good vehicles for that," Mr. Plainer added. "There (are) large levels of liquidity, there's the ease of transactions, etc. What we don't see so much from our client base is a large use of them as longer term exposure for many of our institutional clients. The need for daily liquidity or intraday liquidity is not really there."
BlackRock Inc. and State Street Global Advisors are by far the two largest ETF managers in P&I's survey with $914 billion and $399 billion, respectively, together comprising 68.5% of the total assets.
While those two managers saw their assets increase 21.5% and 17.2%, respectively, smaller players are seeing their assets rise even more dramatically.
The third and fourth overall leaders in sponsored ETF assets, Vanguard Group Inc. and Invesco, saw...