In a year of unprecedented asset gathering for European ETFs, our readers have been laser focused on the continued product innovation in the industry as well as key structural developments in the market.

The wrapper booked record-breaking inflows in the first nine months of 2024, amassing €167.2bn and surpassing the previous record annual inflows of €161.4bn in 2021.

Core equity exposures dominated throughout the year as investors continued to be risk on, pouring into US-large cap equities mostly notably in Q2 and Q3.

The European ETF market also soared past $2.27trn in assets under management (AUM) by October, more than doubling in scale since January 2020.

Stories spanning from BlackRock’s eye catching S&P 500 top 20 ETF launch, Amundi launching Europe’s cheapest all-world ETF and American Century making its European debut made up just some of ETF Stream’s top headlines in 2024.

1. BlackRock launches S&P 500 top 20 ETF

Our most read story this year was BlackRock’s S&P 500 top 20 launch, pushing the boundaries of UCITS eligibility with its highly concentrated portfolio.

Investors ought to be mindful that despite having S&P 500 in its name, the iShares S&P 500 Top 20 UCITS ETF (SP20) provides more granular exposure to the popular index, with the top 20 constituents accounting for more than 68% of the S&P 500’s return over the past three years, according to BlackRock.

SP20 led the charge as Amundi swiftly followed suit with the launch of a US mega cap and ex mega cap stock ETFs.

Fund selectors were torn on the merits of SP20, with some saying it offered unwarranted risk, while others said it targeted quality.

2. BlackRock world ETF flash crashes on Deutsche Boerse as liquidity vanishes

Our second most read story this year was BlackRock’s global ETF experiencing a flash crash on the Deutsche Boerse after liquidity vanished following the release of better than-expected US jobs data.

The iShares Core MSCI World UCITS ETF (EUNL) briefly fell 5% shortly after the key economic data was published.

Investors pulled money from BlackRock’s global ETF as jobs data beat market expectations, which meant that investors dialled back their rate cut hopes, which could lead to negative outcomes for global equities.

3. Amundi launches Europe’s cheapest all-world ETF

In March, Amundi launched Europe's lowest-fee all-world ETF, offering fees at half the rate of its nearest competitor.

Benoit Sorel, head of Amundi ETF, indexing and smart beta, said the aim was to be the first port of call for ETF investors by “continuing to provide building blocks for diversified asset allocation.”

The Amundi Prime All Country World UCITS ETF (WEBG) has a total expense ratio (TER) of 0.07%, undercuting Invesco’s equivalent product by 8 basis points and State Street Global Advisors (SSGA’s) by ten basis points.

4. BlackRock launches synthetic global ETF

BlackRock became the latest entrant in the European swap-based ETF market with the launch of the iShares MSCI World Swap UCITS ETF (IWDS), joining Invesco and DWS in offering similar strategies.

Irish domiciled swap-based ETFs do not pay withholding tax on dividends paid by US companies – as the substitute basket of the ETF is restricted to non-dividend paying stocks – meaning they deliver a lower annual tracking difference versus physical counterparts.

With a total expense ratio (TER) of 0.20%, IWDS became the second cheapest on the market, sitting behind Invesco’s strategy at 0.19% and ahead of DWS’ at 0.45%.

5. Bernie Sanders: BlackRock, Vanguard and State Street ‘oligarchy’ threatens democracy

The ‘Big Three’ US fund giants BlackRock, Vanguard and State Street Global Advisors (SSGA) are a threat to democracy, according to US senator Bernie Sanders.

In a post on X, Sanders critiqued the firms on the basis that they hold $20.7trn in combined assets and are major shareholders in 95% of S&P 500 companies.

In addition, the ‘Big Three’ controls almost a quarter of the votes of the S&P 500 companies, with the dominance mounting due to the rise of passive investing.

It is in contrast to the news that the three fund giants developed corporate proxy voting powers for investors following increased scrutiny of their practices.

6. Clean energy ETFs: Rough ride set to continue in 2024

Clean energy ETFs were set to continue their losses at the beginning of 2024 as the same factors that led to their poor performance in 2023.

These predictions at the start of the year were tied to oversupply in certain sectors and interest rate sensitivity dragging.

Encapsulating this, the clean energy posterchild – the $3.6bn iShares Global Clean Energy UCITS ETF (INRG) – sunk to three-year lows last year.

The predictions largely rang true and of the 20 clean energy UCITS ETFs currently listed, only one delivered positive in the year-to-date. Meanwhile, 14 ETFs delivered double-digit negative returns, as at 11 December 2024, according to data from justETF.

7. BlackRock defence ETF: How does it differentiate from competitors?

BlackRock unveiled its defense ETF in January this year, marking the third issuer to enter the defence ETF tussle in Europe.

The iShares Global Aerospace & Defence UCITS ETF (DFND) was granted approval by the Central Bank of Ireland (CBI) in April 2018, but the asset manager instead chose to hold fire, meaning that VanEck gained the first mover advantage in March 2023.

Compared to earlier entries, DFND provides greater exposure to more traditional defence sector names, however, its nominal revenue-based exposure approach means it also captures companies with low purity of exposure to the sector. DFND also separates itself from competitors with its low fees.

8. Fidelity cuts fee on bitcoin ETP

The approval of spot bitcoin ETFs in the US in January meant that European crypto exchange-traded product (ETP) issuers entered a race to the bottom for fees.

Fidelity was one such issuer – making a headline fee cut for the Fidelity Physical Bitcoin ETP (FBTC) in January - slashing its total expense ratio (TER) from 0.75% to 0.35%.

The reduction brought FBTC closer to Europe’s cheapest physical bitcoin ETP – the 21Shares Bitcoin Core ETP (CBTC) – with a TER of 0.21%.

The fee cuts can also be tied to issuers hoping to capitalise on an expected increase institutional demand.

9. American Century to enter Europe with three active ETFs

American Century marked its entry into the European ETF market in June after registering its fund platform in Ireland and has filed for three ETFs.

The ETFs were set to invest in global, global value smaller value companies and emerging market equities.

Two of these ETFs – the Avantis Global Equity UCITS ETF (AVWC) and Avantis Global Small Cap Value UCITS ETF (AVWS) – listed in October, while the third - the Avantis Emerging Markets Equity UCITS ETF (AVEM) - listed in December.

American Century is one of several American issuers to enter the European market with active strategies, with Janus Henderson also making headline launches in Q4.

10. Big Short’s Michael Burry adds gold ETF as top Q1 allocation

Michael Burry added a position in Sprott Asset Management’s gold ETF in Q1 while downsizing US tech allocations.

Michael Burry's Scion Asset Management invested $7.6 million in the Sprott Physical Gold Trust (PHYS), making it Scion's top buy and 7.4% of its portfolio.

PHYS returned 16% during the quarter as gold prices reached all-time highs. Concurrently, Scion reduced its stakes in major US tech companies, including Alphabet and Amazon, and increased investments in Chinese tech firms like Baidu, JD.com, and Alibaba.