Although exchange traded funds continue to be launched at a rapid pace, it is their rising use in advisor managed accounts that could be the more important growth driver for the $1.3 trillion business.
ETF Trends editor Tom Lydon sits down with Richard K. Dion, President of Placemark Investments, to discuss what the developer of unified managed accounts sees in the ETF industry.
“Our view is that we are at the beginning of a long period of product innovation,” Dion says, with many of the ideas originating in the registered investment advisor (RIA) community specifically related to ETFs.
Many independent advisors have been using ETFs to build portfolios for their own clients for a decade, he tells Lydon. Now, some strategists are building portfolios of ETFs for other advisors to use. Placemark strives to make those strategies easily available and transparent for advisors who want to use ETF portfolios in place of mutual funds and other vehicles.
“Some advisors like to build their own asset allocations,” Dion explains. “Some advisors are moving more toward an outsourcing model where they’re looking for managers who can run a specific strategy for them.”
He also talks about how ETF providers such as iShares, Vanguard and others are enthusiastically working with advisors who are packaging ETFs in portfolios.
Watch the video to see the full interview.