The Australian ETF industry has extended its strong growth, exceeding the $70 billion milestone for the first time.
While ETFs have grown since inception in 2001 at a rapid 45% compound annual rate, the almost 100 year-old LIC/LIT industry has, in the same period, grown at only 11% p.a. Since exceeding the size of the LIC industry in January 2019, ETFs are now $25 billion larger at end August 2020.
Indeed, given the banning of sales commissions for distribution of LICs, which came into effect in May 2020, the LIC industry will continue to grow sluggishly, with an increasing number of investors preferring the open-ended nature of the ETF structure.
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