A recent report by McKinsey & Co. predicts that the actively managed exchange traded fund business will take off and hit the $1 trillion mark within a decade. Thus far, actively managed ETFs account for 1% of all ETFs, and in the U.K., where the study is focused, the percentage is lower.

Actively managed ETFs have yet to gain major traction, although providers have been trying to get specific active ETFs off the ground. According to Chris Flood for the Financial Times, there are more than 800 applications for new active ETFs that have been filed with the SEC.

“Many are from traditional managers without ETF products who are simply preserving their options in case the market expands,” McKinsey said.

The major hurdles facing active ETFs are transparency issues, and higher costs. [BlackRock Files to Launch Active ETFs]