The objective of regulators is supposedly protect investors and facilitate the means for them to access the markets in a safe and efficient manner, yet they seem to do the exact opposite.
German ETF Market Overview
Germany is Europe’s largest ETF market with a 29% market share of European ETF market. Approx. $410bn AUM invested in ETFs and it is the fastest growing Retail market in the region.
The “star portfolio manager” syndrome is taking over ETFs
Very interesting to see Blackrock launch an Active Fixed Income ETF for star portfolio manager Rick Rieder.
This was no doubt a response to the run-away success that JP Morgan has had with the JPMorgan Equity Premium Income Active ETF (now at $25.9bn AUM) managed by one of their star portfolio managers, Hamilton Reiner. The active manager battle within ETF is now well and truly on.
New investors to accelerate growth in European ETF market
A new report predicts a wave of ETF adoption from the next generation of European investors. According to the Blackrock’s report, ETF investors are getting younger, as 18–34-year-olds replace 35+ age group as dominant cohort. The number of European ETF investors projected to grow by 32% in the next 12 months. Iberia is expected to grow the most and Germany could deliver 2 million new ETF investors.
What is ETF good practice?
In latest report, IOSCO suggests for ETF issuers to avoid “exclusive arrangements” with APs and market makers, especially if this impacts the arbitrage mechanism. It also stresses the importance of conducting due diligence when onboarding APs and market makers as well as monitoring them on an ongoing basis.
HOW TO ENTER THE EUROPEAN ETF MARKET
Launching an ETF business is a big commitment, one which takes considerable thought and planning.
The 3 obvious market entry strategies are Build, Buy or Partner.
Some things never change
The recent news that the EU Commission has toned down on its calls for an inducement ban in Europe hardly came as a shock to us. There are too many vested parties operating in the market to make such a ban likely, unfortunately, and by that, we mean the traditional asset management space.
IS IT WORTH LAUNCHING AN ETF BUSINESS IN EUROPE?
Should more mutual fund managers be taking ETFs more seriously? Find out Pros and Cons when launching an ETF business in Europe.
What if they are all wrong?
Another ETF report, this time from Oliver Wyman predicting more great things for the ETF market in the years ahead. But what if they are all wrong? What if rather than grow by 50% or a 100% or whatever the predictions are, suppose all the stars aligned and the ETF market exploded and grew 10x or 20x. What would happen then?
The ETF Distribution model 2.0
COVID has had a profound impact on how the ETF Distribution model works and for the better according to a new report that we recently launched.