Advisers favour ETFs for platform availability, lower costs

Vanguard Asset Management has revealed that advisers think lower costs and better availability on UK platforms are the most likely reasons to start or increase their usage of exchange traded funds.

In a poll taken amongst 220 advisers at its June Investment Symposium, the firm found that while 50 per cent plan to increase ETF allocations over the next 12 to 24 months, 26 per cent believed more education was needed to help inform ETF asset allocation decisions.

The firm’s educational microsite for advisers has seen increased traffic over the last 12 months. Nick Blake, European head of retail at Vanguard, said he was seeing increased appetite for ETFs as many more advisers are recommending them for clients’ portfolios.

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He said: “However, it comes as no surprise that more education and better availability on UK platforms is needed to encourage greater usage.”

ETF consultant ETFGI showed that there were record flows into the products in the last couple of months, with BlackRock’s iShares division experiencing inflows of $9.7bn (£5.77bn) in April, followed by Vanguard with $6.5bn (£3.86bn), and Lyxor ETFs with $1.4bn (£830mn).