Exchange Traded Funds are a global success story that began in Canada in March 1990 and reached Europe in 2000 - SIX Swiss Exchange was among the first European exchanges to launch an ETF segment. Since then, the number of providers, products and invested assets has steadily increased.

Moderated by Deborah A. Fuhr, Managing Partner & Founder ETFGI, three representatives of weighty European ETF providers discussed current trends in the ETF sector in the virtual BörsenTalk am Mittag on 29 March 2022: Arnaus Llinas (Head of ETFs, Indexing & Smart Beta at Amundi), Olivier Paquier (Head of ETFs at JP Morgan) and Andreas Zingg (Head of Switzerland & Liechtenstein at Vanguard).

Recording of the Panel

ETFs: the Ideal Product for Private Investors?

In 2021, approximately USD 190 billion flowed into ETFs in Europe, according to the speakers. The growth in assets is thus around three times the average of the past five years. Furthermore, the speakers highlighted that about half of those inflows were invested in ETFs with an ESG focus.

In the webinar, ETFs are described as the most democratic investment of all, as all investors pay the same price, contribute to the same pool of liquidity - and thus all benefit. For this reason, ETFs are particularly interesting for private investors. While in the U.S. 50% of ETF assets come from private investors, in Europe, banks and asset managers are still responsible for the majority of funds. But private investors will also catch up in Europe, that’s what all participants agree on.

ESG: Trend Reversal or Breathing Space?

In the first few months of 2022, there were less inflows into ESG ETFs than the year before. According to the speakers, investors increasingly turned to more defensive investments such as gold or oil and gas due to the current geopolitical situation. In the long term, however, the trend toward ESG investments will continue, the panelists affirm.

The ETF outlook for 2022 is promising for all speakers: the ETF trend will continue, private investors will increasingly recognize and use the benefits of ETFs, and ESG ETFs will continue to attract a lot of new money.

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