Active ETFs to see significant growth

State Street published its latest report this week on the potential actively managed ETFs, noting that in 2022, actively managed ETFs accounted for about 15 per cent of global net inflows in ETFs. By March 2023, that number had grown to 25 per cent.

State Street argues that this increase in popularity of actively managed ETFs can be explained by changing supply and demand dynamics. Looking ahead, they expect these dynamics to not only remain constant, but also accelerate the growth and innovation of actively managed ETFs.

I am reporting from the IMPower Fund Forum conference in Monte Carlo this week having spoken and chaired on a number of ETF panels. Traditionally the conference of choice for the fund industry generally, it was interesting to see that ETFs are seeing greater adoption and a higher profile in meetings and sessions here. My panels featured investors in ETFs, thank you to Irene Bauer of Twenty20 Investments, Mark Northway of Sparrows Capital and Andrew Limberis of OMBA for presenting the view of the investor in ETFs and Monika Calay of Morningstar for giving us some excellent data points on which to pin theory. We also had Julien Scatena of our data partners, Trackinsight, Tony O’Brien of US Bank, Kenneth Lamont of Morningstar, Weixu Yan of Close Brothers Asset Management and Robert Oliver of Global X ETFs on our thematic panel with Lamont urging the industry not to look ahead at creating more thematic ETFs without developing a strong dataset for the ones we already have.

The heated debate saw Izabella Kaminska, former editor of FT Alphaville, and current editor of The Blind Spot, arguing with Pasquale Capasso, head of southern Europe and LatAm ETF Capital Markets on whether ETFs pose a threat to the capital markets. The audience was undoubtedly biased and clearly voted against Kaminska but she certainly fought her corner with style and passion.

Beverly Chandler, Managing Editor

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