Demand for ETFs will continue to grow - Wegner

Demand for ETFs will continue to grow - Wegner

The head of European distribution at ETF Securities has said he does not see demand for the investment proposition slowing down.

This year marks the fifteenth anniversary of Merrill Lynch’s launch of the LDRS series – Europe’s first exchange-traded fund – on the Deutsche Börse.

Since then the funds have gone on to balloon in size across the continent.

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Bernard Wegner said he believed demand could slow down but continue to grow.

He said: “Nobody can say whether the speed of growth will continue but demand will.

“More and more private individuals and retail clients are using them, but the percentage is still small compared to the US – so there is more room for growth.

“I think their popularity is a combination of low-cost, flexible trading and the ability to access asset classes which haven’t been accessible before.”

According to research and consultancy firm ETFGI, assets in ETFs and ETPs listed in Europe reached a new record high of $494.8bn (£331.9bn) at the end of February 2015.

The European ETF/ETP industry had 2,109 funds or products, with 6,420 listings from 50 providers listed on 26 exchanges in 21 countries.

However, while investors in the US can take advantage of tax benefits while investing in ETFs, the same is not true in Britain.

Adviser view

Adam Laird, passive investment manager at Bristol-based Hargreaves Lansdown, said: “We definitely believe that ETFs are being used more widely, and the biggest reason is because they offer a low-cost way to get access to the stock markets.”

Note: We have been asked to point out that Mr Wenger’s name is correctly spelt Wenger, not Wegner as above.