Increasingly banks and asset managers are competing for a slice of the ETF pie - and are expanding across a diversity of geographical regions. Vanguard, the third largest provider of ETFs in the US according to BlackRock, plans on launching its inaugural range of UK-based funds some time this year.
Although the firm remains vague on specific details, it says it would follow its US model of offering ETFs for most of its open-end mutual funds and would only launch a few ETFs initially, in order to grow over time. Some are sceptical about the firm’s distribution capabilities in the UK, but its level of success in the US means participants await the initial product launch with interest. Click here for full story.
In this month’s cover feature, Helen Fowler documents some of the effects of the rising number of new entrants to the ETF market. While there is evidence of total expense ratios reducing to an extent, there is some question as to the appeal of more funds tracking the same core benchmarks, which may further fracture liquidity within the European market. Despite this, more players joining the ETF arena is a sign of healthy growth, and long may this continue.
The last few weeks have also seen the Greek sovereign debt crisis play out, with investors consequently shorting the euro and flocking to perceived safe haven assets. This has caused greater inflows into gold ETPs, while precious metals-based products have been benefiting from the rising interest in auto-catalysts for car production. Now we are on the road to economic recovery, combined with the path towards reduced emissions, auto-catalyst production is likely to increase which is good news for platinum and palladium-based ETCs.
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Reporting to Steve Hill
Appointed on 19 September
Plans to double size in five years
Unnamed company valuation reduced