As exchange traded fund investment tools become a household name, registered investment advisors, or RIAs, will see greater demand for ETF products in client portfolios, with an emphasis on hedging risk, according to an Invesco market research study.

RIAs surveyed in the Invesco study believe ETFs will account for 24% of portfolio allocations in the next 12 months and 33% in the next three years, a 10% rise in expectations over RIAs surveyed in 2011. [Schwab Study: ETFs Are Here to Stay but More Education Needed]

More advisors are including ETFs into the mix. Of those surveyed, 24% adhere to an all active management portfolio and 19% exclusively use ETFs/passive management portfolios.

Additionally, 91% of RIAs see clients are more interested in mitigating risk rather than maximizing gains. Risk management is still a major concern, with 40% of RIAs citing risk as a predominant trend in managing assets. The survey revealed wealth preservation is the most important issue, followed by risk mitigation.

“This year’s study continues to show how RIAs are embracing the value of ETFs and the many ways they can be implemented in their clients’ portfolios,” Bobby Brooks, National Sales Director for Invesco PowerShares, said. “But even as the equity markets have enjoyed a strong run year-to-date, RIAs are still indicating that risk management is a primary focus and they are looking to a variety of products, including alternative assets, to manage risk.”

For more information on the ETF industry, visit our current affairs category.

Max Chen contributed to this article.

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.