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ETF Securities unveils ‘white label’ service to serve wealth managers
by Robert St George on Sep 10, 2013 at 11:01
A service which allows asset managers to build their own exchange traded funds (ETFs) for wealth managers has been launched by ETF Securities.
Called Canvas, it allows users to create individual ETFs, run a bespoke ETF platform, convert other mutual funds into ETFs, or add an ETF share class to another fund, through an open architecture model. It also supports physical and synthetic ETFs.
The ability to change open-ended funds into ETFs is aimed at those running such vehicles who wish to offer their investors intraday liquidity.
Matt Johnson, EMEA head of distribution at ETF Securities, noted that $350 billion has been allocated to ETFs in Europe but ‘many do not have the infrastructure, expertise or resources to build their own products’.
He predicted the ETF market would expand by more than 50% over the next two years as more investors turned to such products for their ‘cost advantages, transparency and ease of use’.
Johnson told Citywire Wealth Manager he expected Canvas to appeal to ‘different ends of the spectrum’ from asset managers to wealth managers. The former would be interested in it for the purposes of ‘gathering assets’, he explained, while the latter would be providing those assets.
He confirmed that it would focus on more advanced ETFs, rather than simple FTSE or S&P trackers.
This would mean that while it would be ‘keenly priced’, Johnson said, it would not be at ‘bargain basement’ levels.
He estimated that costs would typically be in line with ETF Securities’s more complex products, such as commodity baskets, but far cheaper than ‘two and 20 hedge funds’.
ETF Securities operates more than 300 exchange-traded products, spanning asset classes from equities to commodities and currencies, with worldwide assets now amounting to $22 billion.