RIAs are the biggest single driving force behind the growth of ETFs and, together with broker-dealers, account for almost half the $2.6 trillion in U.S. ETF assets, according to Broadridge.
— (Related on ThinkAdvisor: ETF Investing Strategies to Use Now: BlackRock's Richardson)
Its fourth quarter 2016 Fund Distribution Intelligence report shows that RIAs were overseeing almost $700 billion in ETF assets by the end of last year while independent B/Ds were responsible for $514 billion.
— (Related on ThinkAdvisor: Asset Managers Struggle With Outflows, Fee Compression)
"It used to be that institutional investors were driving the growth of passive investments. Now advisors moving to fee-based low-fee products within portfolios are responsible," says Frank Polefrone, senior vice president of product development at Access Data, the data analytics group at Broadridge. "Robos are a big part of this."
For all of 2016, net new assets of ETFs rose by $405 billion, up 18.4% from the previous year. RIAs were responsible for just over one-quarter of those money flows, or $116 billion, which were up 20% from the previous year.
— (Related on ThinkAdvisor: Active Managers' Struggle to Maintain Assets)
Total flows into passive assets – including index mutual funds – from third party channels rose 20% to $610.7 billion in 2016, while flows into active assets increased less than 2%, or $113.2 billion.
Retail channels were responsible for two-thirds of the flows into passive assets; institutional channels accounted for the rest.
