ETF industry developments include new products with exposures to less liquid and more novel asset classes and more complex investment strategies. The IOSCO Board has therefore concluded that ETF Principles would benefit from being supported, and further operationalised, by a set of Good Practices.
The Board of the International Organization of Securities Commissions (IOSCO) today published Good Practices Relating to the Implementation of the IOSCO Principles for Exchange Traded Funds covering effective product structuring, disclosure, liquidity provision, and volatility control mechanisms.
Following an extensive review of ETF markets, IOSCO has determined that the existing IOSCO Principles for the Regulation of Exchange Traded Funds (ETF Principles) remain relevant and appropriate. Since the publication of the ETF Principles in 2013, ETF markets globally have continued to evolve and exhibit sustained growth in assets under management. ETF industry developments include new products with exposures to less liquid and more novel asset classes and more complex investment strategies. The IOSCO Board has therefore concluded that ETF Principles would benefit from being supported, and further operationalised, by a set of Good Practices.
Jean-Paul Servais, Chair of the IOSCO Board, said: “With the publication of these Good Practices, IOSCO ensures that its policy framework for ETFs remains up-to-date, particularly in light of significant market developments since the publication of IOSCO’s ETF Principles. This report provides a rich discussion of major themes and recent developments in ETF markets as a backdrop to a set of Good Practices centred on the trading of ETF shares in the secondary market and the associated arbitrage mechanism.”..
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