Insights Powered by Cogent Reports™
It’s no secret that ETF use is up. In fact, a multitude of industry forces are fueling the growth in the ETF category, and the momentum is only poised to continue. Not only in one market, either. ETF use is reaching new levels among advisors, affluent investors, DC plan sponsors and both US and international institutional investors. While this is great news for top ETF providers, many smaller providers are nipping at their heels. The influx of growth will bring in new players and new challenges that providers will need to be aware of in order to survive and prosper.
In nearly all of our Cogent Wealth studies, we ask respondents about ETFs, which gives us a unique perspective on the category. We have gathered ETF-related findings from five of our most popular reports to provide a broader understanding as to why this category is experiencing such steady, and at times, extraordinary growth.
The following are the most important factors in what industry leaders will need to consider to continue to stay informed and be able to pivot when needed.
Focus on Fees
Across all sectors of the financial services industry, there is clear evidence of increasing pressure on product providers to reduce the fees associated with their investment offerings. In addition, the recent Department of Labor (DOL) fiduciary ruling is pressuring product providers and advisory firms to defend their fee structures and offer lower-cost options to clients whenever possible. Upon examining our data, it’s clear that this heightened focus on costs and fee transparency is strengthening the appeal of ETF products across all markets. Continue reading