Exchange traded funds (ETFs) proved their worth as an asset class during the pandemic, providing a source of price discovery and enhancing liquidity for asset managers in highly uncertain and volatile markets.
In fact, Covid-19 effectively laid to rest the old debate about how effective ETF wrappers really are as they provided an excellent tool for asset managers and investors who were navigating the primary and secondary markets amidst challenging times.
ETFs were found to be useful for both passive and active strategies as well as for both beta and thematic strategies. They were also cheaper and easier to use than other investment instruments. Overall, a survey conducted by Brown Brothers Harriman of 350 institutional investors in the United States and Asia finds that ETFs will continue to be a favourite asset allocation tool going forward.
Despite a volatile market as a result of the ongoing Covid-19 pandemic, the ETF market experienced robust growth last year. According to ETF research and consulting provider ETFGI, assets invested in ETFs and ETPs listed globally have reached US$8.06 trillion as of end-January this year.
Against this backdrop, The Asset announces the ETF Awards winners of The Asset Triple A Sustainable Investing Awards for Institutional Investor, ETF, and Asset Servicing Providers 2021.
Best ETF Provider, Asia
Best ETF Provider, Taiwan
Winner: Yuanta Securities Investment Trust
As the largest ETF provider and the leading player in Taiwan, the ETF hub in Asia, Yuanta Securities Investment Trust has made a strong impact in the region by leveraging its existing partnerships and collaborations, particularly in Southeast Asia. Yuanta used various channels, including video conferencing, to service the needs of clients.
With the strong performance of Taiwan stocks, the Taiwan ETF market was one of the most dynamic in the region amid the pandemic. In 2020, the market expanded 25% y-o-y with assets under management (AUM) hitting NT$1.8 trillion (US$64 billion). Yuanta remains the largest ETF provider with NT$520 billion in AUM at the end of last year, marking an increase of 18.4% y-o-y. The number of its beneficiaries also doubled from the previous year, reaching 956,597 as of end-2020, capturing more than 55% of the total beneficiaries in Taiwan’s ETF market.
Best ETF Provider, Taiwan
Highly Commended: Cathay Securities Investment Trust
Being the second-largest ETF provider in Taiwan, Cathay Securities Investment Trust had a fruitful year last year. Its AUM hit NT$268.76 billion and beneficiaries were up by 550%. With aggressive moves in terms of rolling out new thematic ETFs and marketing strategies, Cathay captured the attention of the young generation who showed great interest in entering the ETF markets, with particularly strong interest in the technology sector.
Best ETF Provider, Hong Kong
Winner: CSOP Asset Management
Hong Kong was another hot market last year, with the ETF market achieving an all-time high of more than US$50 billion in AUM and attracting a five-year high of over US$5 billion in net inflows, according to the Hong Kong Stock Exchange. CSOP Asset Management captured the strong momentum by issuing more than 10 new products, growing its AUM by 65% to US$9.96 billion.
Best ETF Provider, China
Winner: China Asset Management
China's ETF market witnessed high-speed development last year as a result of the strong performance of the stock market. Though coming from a low base, the market has been quickly attracting investors. China Asset Management continues to be the largest player with a market share of 23% and AUM of US$35 billion.
Highly Commended: China Southern Asset Management
China Southern Asset Management is coming up fast in the ETF space. Last year the firm recorded a 20% increase in AUM to US$13 billion. Its overall tracking error in the last five years was a mere 0.46%, the best performance among all ETF managers in China.
In Australia, the Best ETF Provider award goes to BetaShares in recognition of its success in attracting 26% of new money coming to the market last year. VanEck is Highly Commended for this award for its 60% growth in AUM. In Japan, Nikko Asset Management repeats as Best ETF Provider for maintaining a strong position in the home market and recording a 28% increase in AUM. In Malaysia, Affin Hwang wins Best ETF Provider for engaging with more retail investors and its focus on ESG. In Vietnam, SSI wins as Best ETF Provider for its dominant market share.
Best ETF Market Maker, Asia
Winner: Jane Street
As one of the world’s largest ETF market makers, Jane Street has maintained its leading position in Asia. Its client base expanded by 30% last year, with a particularly strong position in fixed income ETFs. The firm traded US$30 billion in the region or on behalf of Asian clients.
In Taiwan, Yuanta Securities wins the awards for Best ETF Participating Dealer, Best ETF Market Maker, and Best ETF Broker in recognition of its dominating position in each business. Fubon Securities gets the Best ETF Participating Dealer, Taiwan, Rising Star award for its efforts in scaling up the PD business, particularly in equity and commodity ETFs. SinoPac Securities is Best ETF Market Maker, Taiwan, Highly Commended, for its leading market position in fixed income ETFs.
Best ETF Custodian, Asia
HSBC continues to show its strong service capabilities to support the Asian ETF industry, developing multiple innovative products in 2020. The bank provides services for two out of the top five ETF managers and four out of the top 10 players in Asia.
Brown Brothers Harriman wins Best ETF Custodian, Hong Kong, for servicing 67% of all actively managed ETFs listed in the market. DBS wins Best ETF Custodian, Singapore, for its one-stop-shop service for ETFs and 20% market share in providing custody and fund administration for Singapore-domiciled ETFs.
Best Index Provider for ETFs, Asia
Winner: FTSE Russell
With its leading position in providing innovative benchmarking, analytics and data solutions, FTSE Russell continues to show its commitment to markets in Asia. In 2020, 16 new ETP products in Asia-Pacific ranging from money market ETF to fixed income ETF were launched using its indices. The index provider continues to engage the industry on ESG topics to scale up ESG and sustainable finance in the region.
Highly Commended: S&P Dow Jones Indices
With 18 newly listed ETPs in the Asia Pacific choosing S&P DJI indices, S&P recorded an 18% y-o-y growth in AUM and serviced US$35.3 billion of products as of end-2020. With a strong focus on markets such as Australia and Japan, S&P continues to be recognized by major ETP product issuers for providing a full range of investment choices and access to various asset class exposures.
In China, the award for Best Index Provider for ETFs goes to China Securities Index (CSI) in recognition of its continuing leading position in the market, with 244 out of 337 ETFs listed in China tracking CSI-managed indices. Shenzhen Securities Information wins the Rising Star award in recognition of its outstanding capabilities in rolling out innovative and tech-themed indices.
For the complete list of winners, please click here