ETFs Are A Disruptive Force
Exchange traded funds are changing the economics of the asset management business. They will pressure profit margins and impact the valuations of virtually every asset management firm within the next three years.
The number of exchange traded funds has grown from less than fifty in early 2000 to 1,656 as of 1/14/16. During that same period, assets have increased from less than $100 billion to $2.0 trillion. The number of sponsors has grown from less than 10 to 72.
While three ETF firms dominate the market, a group of companies, some virtual upstarts, have managed to gather over a quarter of a trillion dollars in ETF assets.
Dramatic growth does not guarantee success. Four hundred and fifty three ETFs were terminated or de-listed between the end of 2007 and Q1 2016. The 272 ETFs launched in 2015 have average assets of $35 million and have a median asset level of just $5 million.
T Hayes Consulting Helps Asset Management Firms Chart the Right ETF Course for Their Organization
Unique senior sales executive experience with two of the most successful ETF launches in financial history brings with it a deep understanding of the distinctive marketing mix that created the initial ETF phenomenon, as well as, the factors that have enabled new entrants to thrive. That experience separates us from consultants who have only studied the growth.
Some of the most important decisions financial services C-suite executives will make in the coming months and years will revolve around how they combat the ETF challenge. Our experience will provide you a perspective few others can match.
We will provide unbiased, objective advice that is free of internal political factors, compensation considerations or legacy decisions.