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.
“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.
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.”