European headquartered giant funds platform Allfunds, with assets under administration of EUR1.5 trillion, representing more than 940 distributors in 66 countries, is assembling its ETF offering fast.
Chief Product and Strategy Officer, Juan de Palacios, Allfunds, explains that the core team is six to seven people now and predicts a launch later this year.
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Allfunds is best known for its initial incarnation as a platform offering distribution of mutual funds to financial institutions. The firm added private assets last year and is now adding ETPs to its offering.
“ETFs were initially focused on the passive investment space, which worked well. But we’ve seen a shift towards thematic and active management, where distribution is key. This is where Allfunds will play a pivotal role,” says de Palacios. “Allfunds started with mutual funds, but today, we are one of the very few platforms that can offer all three major asset classes—mutual funds, private markets, and ETPs—on a single platform.”
The move to include ETFs came from listening to clients, and a survey conducted last September saw 80 per cent confirming that they wanted to invest in active and thematic ETFs.
“We can help them as we are a wealthtech platform providing solutions in 63 countries, with over 1,000 clients,” de Palacios says.
“We always had ambition to help our clients to get access to investments by providing the largest total range in mutual funds, private assets and now ETFs and now we will be one of the first platforms to offer the three in one place.”
De Palacios sees a trend of fund issuers offering innovation through ETFs in the active space.
“There were barriers, but now companies will be able to offer a broad range of ETFs through our end-to-end platform. We will be able to support issuers in launching their ETFs, connect them to the largest distribution platform and provide them with the tools to scale, such as our cutting edge data-driven solution, Allfunds Navigator.
“The key missing piece in the ETF business within the UCITS space—which is still small compared to the US but growing rapidly—is distribution. 100 per cent distribution.
“In the mutual fund business, the fund manager has a seat at the distribution table. They know who is buying and selling their products. However, what surprised me about ETFs is how little visibility issuers have into who is purchasing their products. This is where we can make a difference. We empower ETF issuers to scale by providing insights on investor flows through our Allfunds Navigator tool. Our sole ambition is to help issuers grow faster and more efficiently. With a cross-border presence in over 63 countries, we have deep insight into global fund flows, enabling issuers to optimise their distribution strategy.”
Allfunds is not a trading venue but a distribution venue, he says. “That’s a key distinction. We engage directly with manufacturers, and our goal is to bring active ETFs to the buy-side, ensuring they have the same seamless experience as when they buy private assets or mutual funds.”
