As The Size Of The ETF Industry Grows, So Do The Risks

According to research by London-based ETF industry consultant, ETFGI last year global listed ETFs/ETPs grew faster than the global hedge fund industry, attracting $389.4 billion of net inflows compared to $70.1 billion of hedge fund outflows, the second largest

The fact that exchange traded products attracted more assets than hedge funds last year isn’t wholly surprising, considering the backlash against hedge fund fees, poor performance figures and mass-market appeal of exchange traded instruments. However, these figures are interesting for two other reasons.

First of all, despite warnings about the structure of the ETFs and the risks they may pose to the markets, investors still seem more than willing to pour money into these products. Secondly, the sheer size of the...