EUROPE – The European exchange traded fund market got a double boost today from Morgan Stanley and Barclays Global Investors.
Morgan Stanley released a report saying assets under management in the European ETF market have risen by 41.5% in the year to date. Global AUM was up 16.1%.
BGI’s iShares unit is the largest ETF manager in the world – with a 47.4% share and assets of $170.5bn – Morgan Stanley added. State Street Global Advisors is the second largest at $77.8bn or a market share of 21.6%
Separately, BGI unveiled what it called a revolution in the market. It said the number of iShares’ ETFs listed on the London Stock Exchange is set to double in less than a week.
The new funds – increasing from 14 to 28 – will be introduced in three tranches between October 31 and November 21.
“The launch of these new funds will revolutionise the way investors can gain exposure to important markets such as Eastern Europe, the Far East and emerging markets, and asset classes such as fixed income and property,” said iShares’ Europe chief executive Chris Sutton.
BGI has called the move “the most ambitious product launch ever attempted in Europe”, and expects to have more than 140 individual fund listings across Europe by the end of Q1 2006 – a substantial increase from its roughly current 70.
“In a world of uncertain returns, economics and politics, people are going to have to go further in the world to get their returns,” said Sutton.
He told IPE that larger pension funds will use ETFs as a supplementary tool, while smaller funds will use them to gain the exposure they could never ordinarily have done – “a toe in the water”.
Increasing burdens on pension trustees are also thought to make ETFs more attractive, according to some commentators at the BGI announcement in London.