In the separate accounts space, exchange traded fund managed portfolios are witnessing asset growth tapering off as smaller companies exit and larger providers consolidate their positions.
The 10 largest asset managers in the ETF managed portfolio space account for 75% of industry assets, compared to 57% a year ago, Investor’s Business Daily reports.
ETF managed portfolio strategies now hold about $102 billion in assets, up 28% year-over-year.
“The landscape is continuing to become more top-heavy,” Ling-Wei Hew, an ETF-managed portfolio analyst with Morningstar, said in the IBD article. “We’re seeing some of the smaller firms drop off.”
Contributing to the flatlining asset gains over the second quarter, some firms exited the space while existing managers expanded their product offerings to fill gaps in their overall strategies.
ETF managed portfolios are a type of separate account service provided by a third-party portfolio manager that include over 50% of assets invested in ETFs. The managed portfolios help track investment strategies and help free up financial advisors to focus on asset gather, tax planning and managing their client’s profile. [ETF Asset Managers Offer Up Their Own Unique Recipes]
“It’s a way for advisers to outsource portfolio management and get institutional-type diversification,” Hew added.
As of the end of the second quarter, there were 667 strategies from 145 firms with $102 billion in assets under management. The largest strategy is the Windhaven Diversified Growth portfolio with $10.1 billion in assets. Other large strategies include the F-Squared Premium AlphaSector Index portfolio with $8.0 billion, the $6.0 billion Windhaven Diversified Aggressive portfolio and $2.9 billion Windhaven Diversified Conservative portfolio.
F-Squared Investments is the largest provider with $25.6 billion in assets under management, followed by Windhaven Investment Management with $19.0 billion.
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.