Exchange traded funds are gaining a greater following abroad as many foreign investors find that U.S.-listed offerings provide a more efficient means to access international markets.
According to ETFGI, institutions in over 50 countries utilize U.S. ETFs in their investment portfolios, reports Jackie Noblett for Ignites.
“Global institutions are looking for non-local exposure and they are using ETFs to get that exposure,” Daniel Gamba, head of Americas iShares institutional business at BlackRock, said in the article. “It’s the preferred vehicle because it’s a very transparent vehicle, and these [pension]plans are highly regulated. They like the fact that ETFs are regulated by the SEC but they are also regulated by the exchange where they are listed. And they like the fact that they are very liquid.”
About 17% of BlackRock iShares’ $561 billion in ETF assets under management comes from international markets, but 75% of the fund provider’s flows from Latin America and Asia are into U.S.-listed products.
State Street Global Advisors calculates that around 9%, or $135 billion, of total assets in the U.S.-listed ETF market are from non-U.S. entities.