The financial industry is beginning to recognize the importance of ETFs. According to a 2014 PwC survey, over two-thirds of asset managers said it was important for a firm to have an ETF strategy, regardless of whether they offer products.

In playing catchup, mutual funds have had to adapt to the different way the ETF industry does business. For instance, poorly defined strategies and insufficient commitment of resources, notably on the distribution side, have caused the unprepared to burn out early.

“You need people who understand the nuances of the ETF business and what it takes,” Jennifer Muzerall, senior analyst at Cerulli Associates, said in the FT article. “If you really build out the structure and you have an executive focused on ETF strategy and how it fits in with the overall business, you’re not taxing the time and the resources of your mutual fund team.”

Alternatively, some companies have outright acquired a smaller ETF firm in their foray into the ETF industry. Janus acquired VelocityShares and New York Life bought IndexIQ last year. [New York Life Makes ETF Debut With IndexIQ Acquisition]

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

Max Chen contributed to this article.