Despite the asset dominance of the three biggest firms, smaller and newer providers are trying to make a splash with alternative ETFs tracking nontraditional benchmarks, for example.
“Asset managers are looking for more ETF-appropriate indices,” said Jonathan Horton, president of FTSE Americas and head of FTSE’s ETP service unit, in an interview. “We’re increasingly working with ETF issuers to develop index solutions.”
He said there are two key trends in the global ETF business. The first is asset concentration, with the bulk of the inflows stilling going to the largest firms. [ETF Business Getting Less Top-Heavy as Inflows Rise]
Yet Horton noted that fragmentation is another trend as smaller providers introduce more ETFs. For index providers, this means opportunities to develop niche benchmarks and to work with providers to develop liquid solutions. [FTSE Hits Century Mark]