Funds Hub

Money managers under the microscope

Rude health, and a changing of the guard?


By Detlef Glow, Head of EMEA Research at Lipper. The views expressed are his own.

The European exchange-traded-fund (ETF) industry has shown some resilience in the face of questions about management practices raised by market observers like the Financial Stability Board (FSB) and regulatory bodies like the FSA in the UK.

The segment grew by 7.74 percent over the first seven month of 2011, with assets under management up by 17.20 billion euros to reach 239.37 billion.

This has come as some critics have characterised ETFs as a systemic risk for financial markets, due to the use of swaps to replicate the underlying index. Another risk that has been highlighted was the liquidity of some securities accepted as collateral to secure the positions in derivatives and for security lending strategies. Also raised was the outstanding short volume in some ETFs.

from Reuters Money:

The year’s best and worst ETFs


Dealers work on the trading floor at IG Index in London May 10, 2010. REUTERS/Suzanne PlunkettThe best investments often don't have the highest returns. I know this is heresy to most, yet mass behavior can be a siren song.

About this time every year, we gaze intently at our portfolios, hoping against hope that we did something right. Sometimes we get lucky.