Allfunds rides MiFID II into ETF landscape

ETF_tradingAllfunds’ decision to launch ETFs on its fund platform was taken partly in light of reforms to the distribution landscape, the European platform provider said.

The company also said the move was significant within the digital evolution of the financial industry.

Allfunds, which offers 52,000 funds and has €280 billion of assets under administration, said yesterday that it was opening its platform up to ETF providers, in part because of shifts in wealth management caused by the revised Markets in Financial Instruments Directive, known as MiFID II.

MiFID II is expected to encourage the sale of ETFs.

At the same time, Allfunds said its digital innovation involved a “fractional dealing” functionality, meaning wealth managers could buy small amounts of ETFs for use in savings schemes, for example. This was described as a technological advance and a “significant boost” for this form of investment.

Juan Alcaraz, Allfunds Bank CEO, said: “Buying an ETF in the stock market is one thing, incorporating ETFs in the wealth management industry’s current distribution framework is a completely different matter. We therefore believe that our ETF service position is unique and brings a new dimension to ETF distribution both for wealth managers and their retail investors.”

Other features of the service include alignment with best-execution requirements, which are intended to lower dealing costs.

Allfunds is working with selected ETF providers, who currently include iShares, Lyxor, Source and Deutsche Xtrackers.

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