Most investors spooked by synthetic ETFs, says Morningstar

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Nine out of ten investors are concerned about synthetic exchange traded funds (ETFs) on the back of a series of warnings from global regulators about their dangers, research suggests.

A Morningstar survey polling nearly 600 investors found whilst the low cost of ETFs continues to make them attractive, some 90% of investors favour the physical-backed versions amid concerns surrounding their synthetic counterparts. "Common across all respondents is a growing and very strong preference for physical replication ETFs over their synthetic alternatives," said Morningstar director of European ETF research Ben Johnson. "No doubt spurred on by the flurry of warnings from global regulators earlier this year, nine out of ten investors are now "somewhat" or "very concerned" abo...

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