Putting the "exchange" back into ETFs

  ETFs can be a bit of a misnomer in the European market. Exchange-listed, absolutely. Exchange-traded? Only sometimes. Estimates of over-the-counter (OTC) trading as a percentage of all European ETF turnover range from 50% all the way up to 80%. Without any post-trade reporting requirements for ETFs, we cannot have much greater certainty of the total volumes traded each day. All we truly know is that on-exchange liquidity of most European ETFs far lags their American counterparts. This lag in liquidity is mostly a consequence of the different nature of the European market. Large inst...