Our colleagues at Lipper have put together some eye-catching data on developments in the ETF industry. You can read the slides here.
Most intriguing is the idea of a slumbering cohort of 241 exchange-traded funds forming what Lipper calls a ‘Death List’; ETFs which are more than three years old, but which have failed to drive assets up to the 100 million euro-mark.
Detlef Glow, Lipper’s head of Research for EMEA, notes these funds might well be thought to be under review by their promoters, but he hasn’t spotted any particular trend towards consolidation. Why?
Well, Glow reckons the question of whether an ETF is proving profitable doesn’t quite come down to a simple volume/management fee play; creation fees and redemption fees play their part too. And promoters like a full stable. Even if an ETF isn’t pulling in punters by the cart-load, they see value in presenting clients with an impressively exhaustive product suite.
All that means Glow isn’t convinced this group is as ripe for consolidation as it might seem. Maybe ‘Death List’ starts to look a bit melodramatic, but successfully marketing ETF data takes some creative gumption. And it’s in the headline to this post, so who am I to judge?