Exchange-traded product market veterans Hector McNeil and Nik Bienkowski have launched an independent ETP platform – BOOST ETP.
McNeil and Bienkowski (pictured) were previously managing partners at ETF Securities (ETFS) and were instrumental in growing ETFS from USD50m of AUM to USD22bn by the time they left in September 2010 and October 2010 respectively. Both are still significant shareholders at ETFS.
The opportunity to launch one of only a few European independent ETP issuers has arisen from the significant changes currently affecting the ETP world. In a market dominated by large investment banks and diversified financial institutions significant questions are being asked about their respective ETP business models. Investors and regulators have been looking for more transparency around practices such as stock lending, collateral management and use of in-house hedging techniques.
BOOST’s origins and independence are very similar to the many successful ventures that have become a feature of the US ETP market which is divided between large fund management companies and many more specialised ETP providers. There are very few banks that have set up as ETP providers in the US, mainly because US regulations would not allow the European integrated bank provider model.
Due to the potential for European regulators to follow the US model, BOOST plans to lead the way in the European ETP market, regardless of the outcome.
BOOST expects significant industry consolidation across the ETP sector and wants to position itself to take advantage of these opportunities as they arise.
Bienkowski says: “We are very excited to launch BOOST at this time. We feel that investors are ready for the dynamic product range we are about to bring to the market. Key to BOOST’s uniqueness will be our product focus and independence. We want to deliver products investors want and need in an independent structure they can trust.”
McNeil adds: “According to the ETFGI report, at the end of Q3 2012, the European ETP industry had 1,920 ETPs, but out of the 46 different providers only one independent ETP provider made it into the list of top 20 providers by assets. BOOST will add significant value to the European ETP market by bringing added value products delivered through a model free from conflicts of interest. Through the experience and dedication of our team we will bring a breath of fresh air to the market dominated by large, institutional and banking conglomerates.”
BOOST’s first ETPs will be launched on the London Stock Exchange.
