Exchange traded funds (ETFs) are becoming so well-known and widely used that discussions of their merits and benefits are beginning to extend beyond all-encompassing ETF conferences. Case in point: the recent Tiburon CEO Summit.
Tiburon Strategic Advisors held their 18th Tiburon CEO Summit on April 14-15 in New York. Tiburon CEO Chip Roame gave a terrific keynote address, a portion of which was devoted to the growth of the ETF industry and the shifting investment landscape.
Among the highlights:
- The investing world has undergone significant changes in recent years: consumers are angry and more risk-averse than they were prior to the crisis.
- $11.5 trillion in net worth was lost in 2008, and just $2.7 trillion of that was recovered in 2009.
- Concerns about retirement have become an even more pressing issue; as a result of the crisis, about 25% of Americans delayed going into retirement.
- Assets in ETFs declined in 2008 from $608 billion to $578 billion, but that has quickly been reversed in 2009 and 2010; ETF assets are now at a record-setting $782 billion.
- ETFs are the fastest-growing product segment on the market; even Schwab called them “the next big thing” last year.
- ETF assets are just 6% of mutual fund assets, and there’s way more growth to be had.
- The 401(k) market remains the last market to be fully tapped by the ETF industry, thanks largely to challenges in record-keeping.
- Active management has yet to take off, primarily because these funds need track records to lure investors.
For more stories about the ETF industry and its performance, visit our ETF performance report page. To find out about upcoming conferences in the United States and worldwide, take a look at our conference page.
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.