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That compares to a monthly average of 48 in 2023, which was also
a record, and 38 in 2022, the data show.
Steady growth in investor interest in the liquidity and tax
advantages offered by ETFs, together with an influx of
innovative products, underpin the growth, issuers and analysts
say. Nor has recent market turbulence dented demand for the
riskiest kind of new products, even as it has whetted investor
interest in "buffer" ETFs that use options to guard against
downside risk.
An example of the riskiest products is the Defiance Daily Target
1.75x Long MSTR ETF, which provides investors a way to leverage
up their enthusiasm for bitcoin by offering 1.75 times the daily
return on shares of MicroStrategy. The software company has used
its cash reserves to become the largest single corporate owner
of the cryptocurrency.
In the week since it launched, the ETF has attracted more than
$50 million of inflows, according to VettaFi, while also
becoming the most volatile ETF on the market, data from
Interactive Brokers shows.
At the other end of the spectrum are products aimed at
risk-averse investors.
"We're seeing a strong pace of new products launching that offer
some kind of focus on income or downside protection" using
options, said John Hooson, managing director of ETF services at
Brown Brothers Harriman.
One of the newest ETFs, the Amplify CWP Growth & Income ETF,
made its debut on Thursday and features aspects of both
approaches. The ETF offers investors exposure to large-cap
growth stocks, while writing call options on some of those
individual stocks to generate additional income.
Another trend is to launch products that form part of the same
family or suite as existing successful ETFs, Hooson noted. On
Tuesday, for instance, Pacer ETFs rolled out the latest addition
to its line of income-based ETFs. The Pacer Nasdaq 100 Top 50
CashCows aims to deliver exposure to the 50 stocks in the Nasdaq
index with the highest free-cash-flow margins, said Sean O'Hara,
president of Pacer ETFs. Next: a Nasdaq 100 dividend ETF.
"It's exciting because so many of these Nasdaq-listed companies
will end up paying dividends," O'Hara said.
(Reporting by Suzanne McGee; Editing by Rod Nickel)
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