Debt-based exchange-traded funds (ETFs) have drawn almost $120 billion worth of inflows so far this year, pushing their global assets under management (AUM) to roughly $660 billion, Bloomberg says. This figure represents less than 20% of the $3.7 trillion in AUM held by exchange-traded products, leaving plenty of room for growth.

Now, JPMorgan Chase & Co. (JPM) is looking to increase its share of the debt-based ETF market and gather assets before rival firms such as investment Goldman Sachs Group Inc. (GS) have the opportunity to do so, according to Bloomberg. (For more, see also: Fund Flows: Bonds, ETPs Reign in a Nervous Market.)

Big Plans

Next year, the bank plans to release at least six of these funds, Robert Deutsch, global head of ETFs for JPMorgan Asset Management Holdings Inc., told the media outlet. Two of these funds, which will be actively managed and focus on short-term, global opportunities, will launch early in 2017, said Deutsch. During the last six months of the year, the major financial institution plans to reveal another 4 or 5 fixed-income ETFs. 

JPMorgan Chase currently has a single-bond ETF, compared to the 211 such funds offered by major asset manager BlackRock, Inc. (BLK). In addition to the six or more ETFs that JPMorgan Chase plans to launch next year, it plans to release a selection of smart beta debt-based ETFs. (For more, see also: Bond ETFs: A Viable Alternative)

Go With the Flow

The financial institution's plans to offer more of these funds may fit in well with broader industry trends, as ETFs have enjoyed strong inflows over the last several years, setting a new record for annual inflows so far in 2016 as they drew $252.8 billion through December 15, according to FactSet data reported on by ETF.com. JPMorgan Chase has been taking advantage of this broader trend by stepping up hiring of ETF-focused sales staff in its asset management business, increasing this headcount from three to nine this year, while planning to add another six staff members in 2017, said Deutsch. 

Top U.S. Bond ETFs

The new debt-based ETFs launched by JPMorgan Chase are entering a crowded space, as they will be competing with larger funds that have already established themselves in the market and accumulated tens of billions worth of AUM. The iShares Barclays Aggregate Bond Fund (AGG), for example, has roughly $41 billion in AUM, making it the largest bond ETF as ranked by etfdb.com.

While this fund has surpassed all other debt-based ETFs in terms of assets, it is practically unchanged this year, having risen 0.67% year-to-date (YTD) at the time of report. Total Bond Market ETF (BND) and iShares TIPS Bond ETF (TIP), which have approximately $31 billion and $20.7 billion in AUM, fared slightly better, rising 1.7% and 1.92% YTD, respectively. iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) had the best performance of the top five ETFs by AUM, increasing 3.28% so far. 

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