IFAs would be more likely to invest in ETFs if they had better access to ETF-based model portfolios, according to a survey from ETF provider Source. Asking 150 UK-based IFAs and discretionary wealth managers who were interviewed by Prescient during March 2016, the survey found that IFAs reported that they would be encouraged to invest more in ETFs if they had greater access to ETF-based model portfolios. Existing users of ETFs had a different view of ETFs, with 71% of those surveyed saying it was the ability of ETFs to offer long-term market exposure as their main reason for using them. This was followed by tactical portfolio adjustments (62%), income generation (40%) and sector rotation (39%).

Financial advisers and discretionary wealth managers in the UK are as likely to buy exchange traded funds and exchange traded products as traditional UCITS products over the next 12 months, according to a new study from ETF provider Source. Approximately one fifth (22%) of respondents said they are planning to purchase more traditional UCITS funds in future while 17% said more ETFs/ ETPs. Of financial advisers and discretionary wealth managers that invest in ETPs for clients, the vast majority (83%) said they had done so for more than three years. While – on average – 13% of firms surveyed had AUM in ETFs/ ETPs.

Four exchange-traded fund providers have joined forces in a bid to better educate the adviser community on ETFs. The ETF Forum has been launched today and is made up of BMO, ETF Securities, Source (in association with LGIM) and WisdomTree Europe. The partnership, designed to help improve the adviser community’s collective understanding of ETFs, will run a series of educational roadshows from 20th June around the UK. The free-to-attend CPD-accredited workshops will feature leading speakers from the ETF industry talking on a variety of topics, including the key characteristics of ETPs, why and how ETFs are traded, and how best to access them.

The first two months of the year saw total net inflows to Japan-listed exchange traded funds and exchange traded products hit a record $9.24bn, according to data from consultancy ETFGI. However, while these domestically listed ETFs/ETPs have gathered record flows, ETFs providing exposure to Japan itself have fared less well with foreign investors withdrawing money. Japan presents a mixed bag for investors with the Nikkei 225 (the most widely quoted average of Japanese equities) performing badly. ETF Strategy takes a closer look at the investment case for Japan and which ETFs are available in the first of this two part series.

Positive first quarter economic data from China suggests the market is set to once again find favour with investors in 2016, according to exchange-traded funds provider Source. Investment spending has grown 10.7% year-on-year to March 2016, while industrial production rose 6.8% and retail sales climbed 10.5% in the same time period. Aggregate financing also rose to CNY6.5tn in Q1, up from CNY4.6tn a year ago. This is perhaps the best indication that local financial institutions believe the economy will expand over the medium term. However, the sharp increase in aggregate financing may also be viewed negatively by some investors who perceive it as further increasing China’s already ballooned debt pile.

When the Retail Distribution Review (RDR) came into force at the beginning of 2013 the exchange traded fund market expected to see a surge in uptake, but advisers were hesitant to use ETFs despite their low cost and liquid nature. That was until recently. Increasingly, there are signs that advisers are beginning to embrace ETFs through direct allocation and via outsourced model portfolios, and many market watchers believe their use is set to boom. If this is to happen, the role of adviser platforms will be key.

European ETF provider Source has released research suggesting there is a growing need for innovative approaches to income investing that address issues such as the quality and sustainability of dividends. More than 61% of institutional investors anticipate that dividends from UK companies will stay the same or decline this year when compared to 2015, according to survey results of 77 institutional investors. Dr. Chris Mellor, Executive Director, Equity Product Management at Source, commented: “Finding quality stocks that pay attractively consistent dividends is becoming much more challenging. Given this, we teamed up with Research Affiliates, the market leaders in smart beta, to develop a suite of ETFs that addresses this growing issue.”

Canadian exchange-traded funds provider Horizons ETFs has reduced the management fee on the Horizons S&P 500 Index ETF (HXS) from 0.15% to 0.10%. The cut in management fee will contribute towards the fund’s accurate and stable performance versus the underlying index, the S&P 500. Steve Hawkins, Co-CEO, Horizons ETFs, commented: “For taxable Canadian investors, HXS was already the most tax-efficient S&P 500 ETF listed in Canada and now with this lower management fee, its total after-tax return appeal will be even greater.”

Over 30% of institutional investors who do not currently use smart beta expect to adopt such strategies within two years, according to a recent survey conducted by Source, a European provider of exchange-traded funds. Dividend-weighted strategies are predicted to be a major driver of this growth with 28% of respondents believing investors will increasingly focus on smart beta strategies to enhance the dividends they receive. Dr Chris Mellor, Executive Director, Equity Product Management at Source, commented: “Smart beta is going to play a growing role in helping investors find quality stocks that pay an attractive dividend.”

Source, a leading European provider of exchange-traded funds, have launched three smart beta income ETFs in collaboration with Research Affiliates. Rob Arnott, Chairman and CEO of Research Affiliates, commented: “Although there are a number of dividend-based indexing strategies on the market, few seek to assure that the stock is attractively priced on measures other than the dividend yield, and even fewer filter to assure that the dividend is sustainable. We believe our extensive research in the smart beta area has allowed us to produce a truly superior way to earn solid and sustainable income from an equity portfolio.”