The ETF market has seen extraordinary growth over the last 10 years. The latest stats from the London Stock Exchange revealed another record year with just under £100 billion in ETFs and other ETPs traded on the exchange, up 29% compared to 2015.
The proliferation of ETFs in the market means more work is required in the selection process. This article places emphasis on the importance of a thorough research process. Apart from size issues, investors should assess legal structure, stock lending policy and underlying instruments. If in doubt there are fund managers who can offer risk graded, mixed asset portfolios made up of ETFs that are constantly assessed. Making sense of new ETF issues can be time consuming, and so it is useful to have an experienced resource available to help make the right decision.
Please be aware, the value of investments will go up and down and you may get back less than you invested. Any tax benefits or tax planning opportunities depend on individual circumstances and are subject to change.
While total ETF industry growth has been impressive, and will likely remain so in coming years, it’s increasingly clear that many funds simply aren’t viable