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Vanguard aims for ETF success in UK
Vanguard Investments UK said it hopes to take on some of the biggest names in the exchange-traded funds (ETF) sector once it has secured its position in the UK retail market.
Nick Blake, head of retail sales at Vanguard, said the firm would look at starting an ETF proposition for advisers and clients in the UK as interest in the funds continues to gather pace.
Mr Blake said the funds were currently more popular in the institutional space but he could see similarities between US and UK retail investors, adding: "ETFs have taken off in the states in a big way."
He said: "We're moving into a position where it is a choice between ETFs and Oeics is pretty well down to the cost of carry."
Mr Blake said he was confident the firm would be able to replicate the success of its US ETF business in the UK with little difficulty.
In the US, Vanguard is the third largest manager of ETFs with approximately $77bn (£46.7bn) under management, according to recent figures from Barclays Global Investors, giving it a 12.2 per cent share of the market placed behind State Street and iShares.
With its range of bond and equities products in the US, it is the third largest ETF provider in the world, ahead of more recognisable names in the UK, such as Lyxor and db x-trackers.
Mr Blake said by entering the UK ETF market the advisers would be able to choose from low cost index-tracking passive funds and the exchange-traded products.
Mr Blake added: "Lots of people think index funds are just index funds, but not all managers are the same."