2018 EXCHANGE- TRADED FUNDS GUIDE - IPE

2018 EXCHANGETRADED FUNDS GUIDE

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l IMPLEMENTATION l FIXED INCOME l ESG l FACTOR INVESTING & SMART BETA l MARKETS & REGIONS l NEW FRONTIERS l REGULATION

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ETFs by

2018 EXCHANGETRADED FUNDS GUIDE

PREFACE 3

Competition and

2018

innovation

EXCHANGE-

TRADED

FUNDS

GUIDE

Editor Liam Kennedy Project editor Hugo Greenhalgh Group Commercial Director Ben Pritchett-Brown Director, UK Business Andy Hill Production Manager ? Advertising Fanni Javor Production Miles Smith-Morris

IPE Exchange-Traded Funds Guide is published with the November 2018 issue of Investment & Pensions Europe ? IPE International Publishers Ltd 2018.

IPEInternational Publishers Ltd 1 Kentish Buildings 125 Borough High Street, London SE1 1NP, UK Tel: +44(0)20 3465 9300 Fax: +44(0)20 7403 2788 , ISSN 1369-3727

C onsolidation has been a hallmark of the ETF sector in recent years as the market continues its growth trajectory, with global assets exceeding $5.7trn (4.9trn) and 46 consecutive months of net inflows in Europe as of July this year. European assets are soon set to exceed the $1trn mark, according to ETFGI.

Can investors rely on established and emerging big players to keep costs down and to continue innovation? On the positive side of the equation, some 66 providers are active in Europe alone at present.

Yet the top three European providers ? iShares, Xtrackers and Lyxor ? account for over 60% of European ETF and ETP assets. While iShares alone has market share of almost 44%, there is a long tail of small providers outside the top three, all with a market share of 7% or less.

And 70% of the assets are concentrated in less than 10% of European listed ETFs and ETPs, with 8.7% (202 of 2,320 listed funds) holding more than $1bn in assets, according to ETFGI.

To stay competitive and relevant, ETF and ETP providers must show they can continue to offer value for money as well as innovate. This may not be so easy as market cost pressures increase and margins diminish in asset management overall.

As many institutional investors embrace equity strategies with pure index, systematic and factor exposure components, with active management strategies under ever more scrutiny, ETF providers have something to offer. And as QE comes to an end and interest rates shift, active fixed income strategies could prove to be an interesting area of competition and innovation.

Liam Kennedy, Editorial Director, Investment & Pensions Europe

Editor's note: this guide contains a number of sponsored articles, as indicated opposite the

frontispiece. The publication of these articles should not be taken as an endorsement of their contents.

Investment & Pensions Europe is published monthly by IPEInternational Publishers Ltd. Nothing in this publication is be construed as advice or relied upon as such. No part of this publication may be reproduced in any form without the prior permission of the publishers. Printed by Pensord, Tram Road, Pontllanfraith, Blackwood, Gwent NP12 2YA, UK.

EXCHANGE-TRADED FUNDS GUIDE 2018

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