Despite threats from hedge funds, exchange-traded funds and separately managed accounts, mutual funds continue to grow in popularity, Investors Business Daily reports.
Point in fact: Assets in mutual funds today are $11.39 trillion, nearly three-fold from $4.46 trillion in 1997.
And in 1997, 14% of household financial assets were in mutual funds, and that rose to 25% in 2006, notes Ed Giltenan, a spokesman for the Investment Company Institute.
“In dollars, mutual funds far outgrow other products,” said Chip Roame, managing principal at Tiburon Associates.
The number of funds also continues to grow. In 1997, there were 6,684 funds, and today there are 8,023.
Nonetheless, mutual funds should still look over their shoulders, for the number of ETFs has grown from 19 in 1997, with $6.7 billion in assets, to 526 with $485.9 billion in assets today. Whereas there were 2,990 hedge funds in 1997 with $368 billion in assets, today, there are 9,800 hedge funds with $1.7 trillion in assets.
And as far as separately managed accounts are concerned, their assets are now at $900 billion, double what they were in 2002.