The number of client accounts at Barclays Stockbrokers holding ETFs has risen 137% in the past two years and is up 42% on 2009.
The average trade size at the firm has also grown by 28% over 2010, while the volume of assets traded has increased by over a third.
Barclays Stockbrokers head of product Paul Inkster says clients are using ETFs both to capture short-term market movements and in long-term portfolio construction. "Two years on from when we first identified the increasing appeal of ETFs for retail clients, the level of take-up and interest in these investment products has been exceptional."
Barclays' figures show investors chiefly using ETFs as a means of accessing the UK market, with funds tracking the FTSE 100 collectively accounting for a quarter of purchases by Barclays' clients across 2010.
Appetites are diversifying however, and four emerging market ETFs feature on the list of the top ten ETF purchases for 2010. Another trend seems to be for clients seeking income, with iShares' FTSE UK Dividend Plus and iBoxx £ Corporate Bond coming in seventh and tenth on the bestseller list.
Inkster adds: "Although clients trade frequently in the main UK markets, especially with ETFs, there is a clear trend towards using both ETFs and managed funds to gain international exposure especially for emerging markets where information and research on individual companies can be less accessible."
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