Institutional Investors Will Play a Big Role in ETF Growth Ahead

The ETF universe has been steadily expanding, with U.S.-listed ETF assets under management close to $3.3 trillion, and the growth is expected to continue as more institutional investors adopt the nifty investment tool.

According to a recent survey conducted by Ernst & Young, 97% of respondents expect institutional investors to continue to dominate ETF investing over the next three years, reports Sophie Baker for Pensions & Investments.

The survey also projected that 15% to 25% of new ETF inflows over the next three years are expected to come from new investors, equating to $250 billion in new money coming in.

Two-thirds of respondents predicted most money managers will have an ETF offering in the coming five years, with the market set to expand 73% to $7.6 trillion globally by the end of 2020. As of the end of September, global ETF assets under management was $4.4 trillion.

An increasing number of traditional active fund managers and money managers are looking into ETFs as a way to bring to market their time-tested investment strategies through the easy-to-use ETF wrapper.