EU referendum result prompted record day for exchange-traded fund activity

William Turvill
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EU Referendum - Signage And Symbols
24 June, the day after the UK voted to leave the EU, was a record day for London-listed ETF trading (Source: Getty)

The UK’s Brexit vote led to a record trading day for London-listed exchange-traded funds (ETFs).

Trading volume on London-listed ETFs – collective investment vehicles which usually passively replicate the performance of specific indices – in June was up 88 per cent year on year.

Read more: ETF market set to more than double in size by 2021

“Recent market volatility has dovetailed with investor demand and the growing choice in fact-based ETFs,” said Mark Raes, head of product at BMO Global Asset Management.

“Investors are recognising the value of using ETFs both as long term holdings and as a trading tool to manage market uncertainty and take advantage of short term market movements.”

BMO’s ETF Outlook Report also found the global ETF market hit a new record high of $3.2 trillion (£2.5 trillion) as of June, with more than $122bn in new assets this year.

Read more: "Closet indexer" fund managers help fuel ETF market records

Raes added: “Global events, such as the Brexit vote, have kept volatility at the top of investors’ concerns. ETFs have proven their value as efficient and effective positioning tools that can help investors manage through market events.

“In Europe, we anticipate asset growth to accelerate as evolving regulation lowers barriers across individual markets.”