Global ETF variety breaks through the 3000 mark
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In focus: Regulating Exchange-Traded Funds
By the end of June this year, data from the research consultancy showed there were 3309 ETFs and 7353 listings across 171 providers on 50 exchanges, representing assets of $1.5bn (£950m).
Deborah Fuhr, founder of ETFGI, said: “More people are using ETFs as they want to gain exposure to different segments of the market.
“It is also hard at the moment to find active managers who are consistently dealing alpha.”
The figures showed ETFs saw net inflows of $18.5m (£11.8m) in the year up to the end of June.
According to ETFGI, 322 ETFs have been launched by 65 providers on 24 exchanges, while 42 ETFs have de-listed in the year up to the end of June 2012.
In June 2012, 25 new ETFs were launched by 15 providers on eight exchanges, while seven ETFs delisted.
One of the most high-profile ETF launches this year came from Vanguard Asset Management, which unveiled its first physically-backed ETFs to be made available to UK advisers and their clients.
Tom Rampulla, managing director of Vanguard, said long-awaited authorisation had been received from the Central Bank of Ireland for a suite of five Irish-domiciled ETFs that were also set to be admitted on to the London Stock Exchange.
Nick Lincoln, director of Hertfordshire-based Values to Vision Financial Planning, said providers were seeing the opportunities to launch more ETFs as clients begin to demand transparency in fees.
He said: “The RDR is driving the ETF market. The changes open the market to passive investing as suddenly investments that did not pay commission have to be considered.
“This is part of a broader move towards a rejection of active funds. ETF providers such as Vanguard are coming to the market to reflect that.
“The sector will keep growing, which is to everyone’s benefit.”
ETFs were drawn into controversy during 2011 after the Basel-based Financial Stability Board warned that they could pose “systemic risks”. The FSA also highlighted concerns about them in its latest risk outlook.