PT  - JOURNAL ARTICLE
AU  - Nik Bienkowski
TI  - From Passive to Active—<em>The Development of the ETP Industry</em>
AID  - 10.3905/jii.2013.4.3.102
DP  - 2013 Nov 30
TA  - The Journal of Index Investing
PG  - 102--109
VI  - 4
IP  - 3
4099  - https://pm-research.com/content/4/3/102.short
4100  - https://pm-research.com/content/4/3/102.full
AB  - Exchange Traded Products (ETPs) are garnering massive interest around the world, and continue to capture a greater portion of fund inflows. ETPs have now garnered over $2 trillion in assets globally, across a variety of asset classes and strategies. Though initially passive, ETPs are now also “active,” both in the strategies/indexes they employ and in terms of their usage, with some ETPs trading their entire Assets Under Management (AUM) on a single day. Much of recent ETP innovation has been focused on alternative indexes, which include smart beta and “alpha”-styles indexes. These indexes seek to generate superior risk-adjusted returns compared to standard market capitalisation-weighted indexes, or offer low correlation to traditional market indexes. As new entrants continue to innovate, ETPs will continue to target niche areas, such as new geographies, asset classes, portfolio-indexes, active ETPs, and more strategic research-led indexes. The result is that indexes associated with more tactical or active investing will find their way into ETP-format, and that the lines between passive and active may appear blurred.TOPICS: Exchange-traded funds and applications, performance measurement