This week’s special ETF Prime episode was recorded live in Miami, Florida, as host Nate Geraci was joined by ETF Trends’ Financial Futurist Dave Nadig and Head of Research Todd Rosenbluth, along with Advisor Circle’s John Swolfs, to recap the ETF event of the year — Exchange: An ETF Experience.

Speaking in front of an audience, a first for the podcast, Geraci talks with Nadig and Rosenbluth about being back at an ETF conference for the first time in years, with thoughts on having over 2,000 registered advisors, asset managers, and more attending this event. There’s plenty to cover regarding the opportunities made available to learn about various funds, firms, and more.

As far as the overall state of the ETF industry, which is currently at $7 trillion in AUM and $200 billion in inflows so far this year, Rosenbluth points out that it’s exceptionally healthy. He believes there’s a chance to break the previous inflows record for the year depending on how things shake out and whether or not the bond market can stabilize.

“This is all happening on the backs of core equity, primarily, and commodity ETFs,” Rosenbluth points out. Given the pacing, there’s a chance to reach a new record number of ETF launches within a year, and there are plenty of firms showing just how promising the industry is to grow even more.

Nadig adds that the industry’s success isn’t even a surprise at this point. “Where we are now is talking about macroeconomics, inflation, the Fed, bonds, portfolios, crypto. It’s just a given that the ETF is the vehicle that will provide whatever solutions the industry can come up with.”

Looking at some key takeaways, Geraci notes the FINRA proposal on more complex ETFs and mutual funds, which has caused some negative buzz due to what it’s forcing brokerages to do to investors. For Nadig, “This would be an unprecedented shift in how financial interactions are regulated in this country.” It would be a very different process for people that would remove the past progress already made for the ETF industry.

A Door Opening For The Bitcoin ETF?

The discussion then turns toward the possibility of a spot bitcoin ETF and why other countries and territories such as Canada and Latin America all have spot crypto products currently trading. Listening to Nadig, he points out how there’s less of a presence of true grassroots-made asset environments. Additionally, finding ways to innovate in other areas is the thought of competing with the established structures.

Additionally, Rosenbluth notes how the pendulum may be starting to swing in America regarding the take on crypto and what’s actually possible. “I’m feeling that momentum, and I’m also seeing it here at the conference,” he adds. That’s not saying anything is definite, but there have been plenty of sessions at Exchange that certainly show considerable interest in the future of a spot bitcoin ETF and further developments in the crypto space in similar regard.

The conversation also features the discussion of ESG and active ETFs. Focusing in again, the talk then extends toward rising rates and inflation and the fixed income challenge. Geraci feels this may have been the biggest topic of the week, noting how there’s been much talk about the death of the 60/40 portfolio. And yet, seeing how this year started, it’s understandable to see why this topic keeps coming up.

Focusing on solutions that investors may not fully understand, Nadig feels it’s absolutely something worth discussing. The market is reacting through reallocations through areas such as dividends. These trade-offs may be being misunderstood, so there’s the hope that advisors are making intelligent choices to ideally reach proper solutions.

“These are complex products, for the most part,” Nadig adds. “There are solutions, but they require more due diligence.”

Rosenbluth also explains how coming up with a fixed income playbook (as suggested by ETF Trends’ managing editor Lara Crigger) could help with making decisions such as shortening duration and looking at floating rate investment grade ETFs or any number of ideas that would allow for informed decisions.

Toward the end of the podcast, Advisor Circle’s co-founder, John Swolfs, arrives to add further thoughts on the experience at Exchange went this week, along with what’s being seen in the industry. He agrees with Nadig as far as how things are only becoming stronger, with less of an emphasis on the idea of being surprised by the growth of ETFs.

Listen to the entire ETF Prime episode with Dave Nadig and Todd Rosenbluth:

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