The IMPower Fund Forum conference in Monte Carlo, the largest fund management event in Europe, saw ETF Express managing editor, Beverly Chandler, speaking and hosting on a series of ETF panels. Traditionally the conference of choice for the fund industry generally, it was interesting to see that ETFs are seeing greater adoption and a higher profile in meetings and sessions here.
Chandler drew parallels with her previous experience in the hedge fund industry, and particularly with the fee differential between those hedge funds, back maybe, 15 years ago, and the fees of ETFs, whether vanilla, thematic or active, today.
“Products where inducements are paid are on average 35 per cent more expensive,” Chandler said. “That is over a third of an investor’s money, going out on fees that could be avoided.”
Chandler also announced a new Off the Record podcast coming from ETF Express, Off the Record – ETFs – the fundamentals, featuring Jason Xavier, head of EMEA capital markets with Franklin Templeton, coming soon.
The first panel: Reflecting on front line experience of managing the risks and preferences for ETFs, featured investors in ETFs: Irene Bauer of Twenty20 Investments; Mark Northway of Sparrows Capital and Andrew Limberis of OMBA presenting the view of the investor in ETFs and Monika Calay of Morningstar providing data points on which to pin theory.
Limberis said he used ETFs because of their: “Transparency and low cost” and also noted that they could have tactical applications in times of market dislocation, “allowing us to add and remove risk.”
Julien Scatena of ETF Express data partners, Trackinsight, presented the findings and key themes from the latest Trackinsight research which showed that professional investors are largely led by wanting diversification and long term bets and that they have an increasing interest and concern about underlying index methodology and the probity of ETF issuers.
The next panel saw Tony O’Brien of US Bank, Kenneth Lamont of Morningstar, Weixu Yan of Close Brothers Asset Management and Robert Oliver of Global X ETFs discussing key trends and main usages of thematic ETFs, with the panel agreeing that key themes in ETFs are AI, the metaverse, cybersecurity and industrial metals. While a future key trend could be water, as detailed by Bauer in the previous panel, and agreed on in this one, Lamont urged the industry not to look ahead at creating more thematic ETFs without developing a strong dataset for the ones that already exist.
The final session was the heated debate which saw Izabella Kaminska, former editor of FT Alphaville, and current editor of The Blind Spot, debating with Pasquale Capasso, head of southern Europe and LatAm ETF Capital Markets on whether ETFs pose a threat to the capital markets. The audience was undoubtedly biased and clearly voted against Kaminska who fought her corner with style and passion.