EDITORIAL: Used and useful

Nick FitzpatrickSigns of maturity in the ETF market are not restricted to growth in assets under management. They are seen in the growing number of ways in which professional investors are using ETFs, such as to manage inflows and outflows from other funds, and to take broad, tactical positions in a new asset class in the shorter term while fine-tuning a longer-term allocation to it.

Certainly one asset class ETF investors have favoured in recent months has been European shares. Our article on European equity ETFs looks at the difference between the two major indices that cover Europe.

Our focus on indices does not stop there. This year’s report also features research from Edhec-Risk Institute about the effect that indices, including alternative indices, and other aspects of the ETF life-cycle can have on a fund’s tracking error.

Finally, we consider how ETFs will develop since the inclusion of China into the MSCI Emerging Markets Index. But don’t miss our expert panel, too. The roundtable considers market risks and the growth of active ETF vehicles.

Nick Fitzpatrick is group editor at Funds Europe

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