“It’s a huge advantage,” Mike Castino, senior vice-president at US Bancorp Fund Services, said in the article. An new ETF with assets of $25m or more and regular inflows “gives it a perceived stamp of industry acceptance.”
For instance, the Deep Value ETF (NYSE: DVP), which was brought to market on Oct. 8 by Exchange Traded Concepts, LLC and Tiedemann Wealth Management, has $127.9 million in assets under management and trades with an average daily volume of about 297,000, according to Morningstar data. [Going Deep for Value Brings Success for This New ETF]
Last year, Vident Financial came out with the successful Vident International Equity Fund (NasdaqGS: VIDI), which has $704.7 million in assets, and recently launched the Vident Core U.S. Bond Strategy ETF (NasdaqGS: VBND), which has $79.7 million in assets. [Vident Bolsters ETF Lineup With New Bond Fund]
The money managers are also opting to partner with white label, or turnkey, ETF service providers. ETF issuers like Exchange Traded Concepts, ActiveETF Partners, Golden Gate Investment Consulting LLC, ALPS, AdvisorShares and ETF Issuer Solutions, among others, help go through the regulatory approval process, provide a board of directors and get an ETF listed on an exchange for $20,000 to $100,000 in startup costs. [The White Label Avenue to Launching an ETF]
For more information on the ETF industry, visit our current affairs category.
Max Chen contributed to this article.