Passive management claws ground at an overwhelming rate. For sample, the main stock market index of Wall Street. Almost 20% of the market capitalization of the S&P 500 is controlled by the three large passive managers, Vanguard, BlackRock and State Street.
In a recent Lazard report on activist funds in 2019, it is detailed that Vanguard funds own 8.2% of the capitalization of the S&P 500, BlackRock – through iShares – has 6.6% and State Street owns 4.4%. Among the three kings of passive management, they agglutinate practically two of every five euros (19.2%) that are invested in the companies of the American selective.
This is another symptom of the rapid role that passive management is taking in today's markets. In Europe, passive funds exceeded in 2019 the trillion dollars in assets under management (about 910,000 million euros), a figure 40% higher than the previous year, according to Etfgi.
Specifically, European ETFs manage more than 100,000 million euros and represent 7% of the total assets of the continent's funds, including assets, according to Lyxor ETF Research.
Among the major players in the fund sector, passive managers gradually add ground to active ones. Summed up Capital Group and Fidelity, the top 5 owns 24.4% of the S&P 500, while the top 10 collects 31%, where names such as T. Rowe Price, Geode Holdings, Northern Trust, Wellington Management and BNY Mellon are also known.
ETF with sustainable criteria
ETFs that invest with sustainability criteria are also booming. “They are still a small part of the asset management industry, but their assets have quadrupled in the last year,” from 4,000 million dollars to 16,000 million, equivalent to an annual growth of 300%, underlines the Lazard investment bank report.