THETRADETECH DAILY THE OFFICIAL NEWSPAPER OF TRADETECH 2018
Growth of the passive
Tom Digby, head of client trading coverage, capital markets, Invesco PowerShares, talks to TRADETech Daily about the rise of exchangetraded funds and offers his thoughts on this year’ s TradeTech conference.
easier to understand. Around 20-30 % of ETF secondary market trading volume was visible pre-MIFID II via on-exchange trading. Now, with post-trade reporting requirements, we are seeing over-the-counter( OTC) volumes come to light whether via multilateral trading facilities( MTF), organised trading facilities underlying trading volumes.
What is driving the growth in passive investing and ETF instruments, and do you expect this growth to continue? TD: ETFs are market access instruments. We live in an on-demand society which has been
“ With fees continuing to decrease across the ETF passive industry, trading ETFs efficiently becomes an increasingly significant component of any investor’ s total cost of ownership.”
What does the European exchange-traded fund( ETF) landscape currently look like? Tom Digby: The European ETF industry continues to see double digit growth year-on-year. In 2017, assets under management( AuM) grew 40 % to reach $ 802 billion, making it a record year since 2009. Whilst being a highly competitive industry amongst issuers this remains an exciting space to be in for all involved.
Furthermore, regulatory tailwinds are favouring ETFs as they aim to further increase transparency and to make investments
( OTF) or reported to a trade reporting facility.
This means firms, with the help of an issuer’ s Capital Markets team, can get a better sense of the true liquidity and trading cost of an ETF from the secondary market and the brought about by having technology at our fingertips. ETFs are as much an example of this as any. The easy-to-use nature of ETFs and the ability to express a market view instantaneously have drawn investors towards
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