The exchange traded fund industry has experienced explosive growth in the United States, with around $1.5 trillion in assets under management. The Asia-Pacific region is currently the fastest growing market for the exchange traded fund business.
“ETFs offer an easy access to Asia which can otherwise be complex due to fragmented markets, each with their own set of regulations for investing. They can also serve as important investment vehicles in countries with restrictions on foreign access, such as China and India,” Shan Lan, ETF strategist at Deutsche Bank, said in a recent report. [Southeast Asian ETFs Heat Up]
The expansion of ETF products in Asia has been sparked by a huge interest in fixed-income instruments, along with market developments in China. ETFs have allowed investors around the world to access mainland Chinese A-shares that are listed in Shanghai. Regulators in China have also erased restrictions on the number of ETFs a manager can apply to launch, reports Chris Flood for Financial Times.
Evidence of the growth in the Asia-Pacific rim of the world is evidenced by the $142.9 billion in assets under management at the end of April. Plus, six of the ten fastest growing ETFs launched in 2012 were linked to Asian stock markets. [China ETFs for a Rebound]