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Magazine Issues » March 2022

Editorial: Changing the pattern

Nick_FitzpatrickFour of the funds industry’s most recognisable abbreviations are crystalising into one recipe for success that could propel Ucits funds to the next level of global popularity, it appears.

One of those abbreviations is ‘Ucits’ itself – funds regulated by the EU’s Undertakings for the Collective Investment in Transferable Securities Directive.

‘ESG’ and ‘ETF’ are – you will not be surprised to hear – two of the other acronyms. It seems that Ucits-regulated ETFs, infused with ESG principles, are finding new markets in Asia and Latin America – or so our ETF roundtable heard from Deborah Fuhr, an ETF expert who studies global and regional ETF flows.

In fact, in Latin America, where ETF investors have usually preferred US-domiciled products, this coalescence of acronyms now seems to be changing the pattern of ETF fund sales.

The fourth acronym is the SFDR – short for Sustainable Finance Disclosure Regulation. This was introduced in 2021 as part of a European Commission Action Plan on Sustainable Finance, and shows signs of becoming a global template for ESG investing.

Nick Fitzpatrick, Group Editor, Funds Europe

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