A new set of investors are adding to the success of exchange traded funds(ETFs)-the venture-capital firms. Several venture-capital firms and other investment firms have announced they are putting money into ETF start-ups, hoping to cash in on the opportunity, reports Diya Gullapalli for The Wall Street Journal. While some of the money is from firms run by high-profile financial service veterans, others are more technologically oriented. These are often first-timers who haven’t put money into an ETF provider, so they are really pushing for education and meeting with the firms.
This month, the total number of ETFs topped 500, with assets around $460 billion in U.S. funds. This influx of cash will effect individual investors, but as of now, how is unclear. Whether it is extra diligence for research and vetting strategies or easy money with which to launch narrow or gimmicky products, it is a welcomed flood of venture capital.
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