Carne Group: Growing focus on ETFs from institutional investors
New research covering pension funds, insurance asset managers, family offices and wealth managers across Europe commissioned by Carne Group reveals 82% agree that ETFs are shifting from short-term asset allocation strategies to core portfolio holdings.
Respondents to the survey say active ETFs are expected to increase market share dramatically over the next three years. Almost two-thirds of investors say that active ETF assets will grow from a 2% market share of total ETF assets in Europe today to between 6% and 9% before the end of the decade. The research also reveals investors are using active ETFs to access new asset classes.
One-quarter of respondents say they invested in crypto for the first time following innovation in the ETF market, while more than half (56%) say they increased their allocation to the asset class. More than one in ten (13%) of investors say they are likely to increase allocations to esoteric asset classes via the ETF market.
However, the study shows some concern from investors that some ETFs are not living up to their active labels. For example, the rise of ‘shy active’ ETFs that follow a benchmark-aware approach, meaning they deviate less from the benchmark index than traditional active mutual funds, offering lower active share and tracking error. Nearly nine out of ten (88%) of the investors surveyed say that managers operating such shy active funds are misleading the market.
