Total AUM growth of non-US ETFs has been relatively high. However, ETFs in Europe have yet to make significant inroads with European and Asian investors. Advantageous fiscal and regulatory environments have contributed to the popularity of US ETFs. This needs to be replicated in Europe.
For European ETFs to fulfil their potential, it will require careful calibration across the European ETF ecosystem. From ETF producers and distributors to the market makers, the capital market teams within the issuers, and most importantly the national regulators. Taken together, the EU UCITS badge and the UK’s Reporting Fund Status for offshore funds are a compelling imprimatur for global investors seeking to invest in European ETFs.