ETFs are quickly becoming recognized as a tool that can blur the lines between equities and other asset classes, because they themselves are baskets of equities that may have underlying assets such as fixed-income, currencies or commodities, explains Bryan Johanson at Traders Magazine. [U.S. News Names ‘Best Fit’ ETF Rankings]
The proliferation of ETFs among traders is creating the need for more short term investors to become knowledgeable about fixed income, global equities and commodity markets, according to the article. Some firms are even creating an ETF-specific trading desk, reports James Armstrong for Traders Magazine. [ETFs As Tactical Investing Tools]
Growing market volatility has also contributed to the growth of the ETF business.
About 62% of financial advisors have turned to using ETFs in conjunction with active management to help mitigate risk. According to an Invesco study, the widespread adoption of active and passive asset allocation strategies is helping to boost growth for the ETF industry, reports the Financial Times.
Tisha Guerrero contributed to this article.