Last year might be known as one long coming out party for exchange traded funds (ETFs).
And if that’s the case, says Murray Coleman for Index Universe, then 2008 is shaping up to be the "Year of the Quant Stock ETF." That’s because in the second half of 2007, three prospectuses for active ETFs were filed, and a majority of the 451 ETFs in registration with the Securities and Exchange Commission (SEC) involve some form of quantitative or alternative methodology.
In 2007, Coleman says, the plain vanilla quant funds fared better while the more exotic ones had a rougher time and fell behind the broader market. This year, providers are gearing up to put more quant funds into the marketplace and they’ve conjured up all kinds of niche index.
It’s bound to be an interesting year as quant-ers duke it out with traditionalists, who favor simplicity in their products.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.