IFAs expecting strong growth in ETFs, finds Source

Mar 29th, 2017 | By | Category: ETF and Index News

A majority of IFAs (56%) expect assets under management in exchange-traded funds globally to rise further in 2017, according to research from Source. The findings follow record in-flows of $389 billion into ETFs in 2016.

IFAs expecting strong growth in ETFs, finds Source

According to Source research, only 3% of IFAs plan to reduce their clients’ exposure to ETFs in 2017.

The European ETF provider interviewed 104 intermediaries during February 2017 on their views regarding the outlook for the global ETF industry in the year ahead.

Only 3% of IFAs surveyed reported an expected decrease in global ETF assets during the year while just over a quarter (26%) expect it to stay the same.

Asked specifically about their own clients, one in seven IFAs (15%) expects to raise clients’ exposure to ETFs in 2017 versus just 3% who plan to reduce exposure. The majority (70%) expect allocations to stay the same. Previous research by Source, which surveyed 92 intermediaries in September 2016, found average client AUM in ETFs and other ETPs was 12%; over half (59%) said ETFs accounted for up to 15% of client AUM.

Dr. Chris Mellor, Executive Director, Equity Product Management at Source, said: “We are seeing increasing interest from IFAs and other intermediaries in ETFs and expect 2017 to be another strong year of growth among this stakeholder base. ETFs continue to deliver compelling benefits to them and their clients, including excellent diversification at a very competitive cost. The capacity to efficiently access key sectors such as commodities and fintech is another significant benefit that we believe will drive strong global interest in ETFs across the year ahead.”

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