ETFs emerge as leading opportunity for asset managers
A recent survey conducted by Cerulli Associates has revealed a significant shift in how asset managers view investment opportunities, with Exchange-Traded Funds (ETFs) taking the lead as the most promising investment vehicle. The survey, based on Cerulli’s annual Products & Strategies survey, received responses from over 30 asset managers of varying sizes.
A recent survey conducted by Cerulli Associates has revealed a significant shift in how asset managers view investment opportunities, with Exchange-Traded Funds (ETFs) taking the lead as the most promising investment vehicle. The survey, based on Cerulli’s annual Products & Strategies survey, received responses from over 30 asset managers of varying sizes.
While open-end mutual funds remain the most widely used investment vehicle among asset managers to deliver investment strategies, the level of opportunity associated with this structure has declined in recent years. According to the report, only 50% of asset managers offering open-end mutual funds see them as a large opportunity.
In contrast, ETFs have surged in popularity, with 74% of asset managers that offer them considering them a significant opportunity in 2023. This marks a notable shift, as in the previous year, 79% of asset managers saw ETFs as a large opportunity.
In addition to ETFs, institutional separate accounts continue to be viewed favorably, with 70% of asset managers considering them a large opportunity in 2023. However, this represents a slight decrease from the previous year when 83% of asset managers held this view.
The survey also revealed that among asset managers not currently offering ETFs, 20% plan to develop ETF offerings within the next 12 months. Furthermore, 50% are considering entering the ETF space, making ETFs the most prominent focus among product plans for asset managers.
Interestingly, the report highlights that 65% of managers are contemplating offering ETFs as a share class of mutual funds, utilizing a structure previously patented by Vanguard Group, which expired in May. While some firms have applied for exemptive relief, the report suggests uncertainty remains regarding whether they will receive approval to launch such products.
