The view from Asia

This week brought you a snapshot of the ETF industry in Asia, brought to you by Nikko Asset Management’s Phillip Yeo. The industry is flourishing, he says, noting that investors, particularly younger investors, are more self-directed across Asia, and that they are also more sophisticated.

In our continuing series celebrating our winners from the European ETF awards this year, we bring you our partnership piece with Amundi, with Benoit Sorel, saying that one of the most significant shifts in Europe recently has been the increasing adoption of ETFs by retail investors.

"Historically, ETFs were primarily used by institutional investors and asset managers, but we are now witnessing a democratisation of investing, with more individual investors incorporating ETFs into their portfolios," he says. "This trend has been driven by the rise of digital platforms and online banks, making it easier for all investors to access these investment vehicles, which could be seen in flows into World and All Country World ETFs."

This week we took a step outside the direct ETF space but into an investment sector which is increasingly being used in ETFs - private markets.

David Nable, Managing Director at operational and data management tech provider to the investment industry, Arcesium, explains that the definition of private markets is a broad one, and explains further that measuring and managing them is also a challenge.

Investors are attracted by uncorrelated returns. "The markets are illiquid and allow for more opportunity for risk adjusted outperformance," he says, adding that such a new market will bring new firms trying to sponsor products to meet demand, including the retail demand for private investments. "But you have to find a way that is compliant – how do you provide liquidity when the underlying assets are inherently illiquid? We are going to see lots of iterations on this," he says.

Ron Bundy, President, Morningstar Indexes & Morningstar Sustainalytics, also took on the subject in this week’s In My Opinion column, writing: "So, should investors dive headfirst into private markets? The answer is clearly no, not without first understanding the unique attributes of private market investing."

Our data partners, Trackinsight, published their annual ETF survey this week, revealing that Active ETFs now represent 27 per cent of global listings (up from 13 per cent in 2019). They attracted USD352 billion in 2024—22 per cent of total flows—and made up 51 per cent of all ETF launches. Read more here.

I will be chairing some of the ETF panels at IMPower Fund Forum in June. For a 10 per cent discount to attend, use this link and code: FKN3972ETFX. I hope to see you there.

Beverly Chandler, Managing Editor

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