IPE: Study shows growing interest in ETFs among pension professionals

29 January 2013

According to a study by State Street Global Advisors (SSgA), pension professionals in Europe are looking increasingly to invest in ETFs, although nearly 40 per cent still have no exposure to this type of strategy.

Michael Karpik, head of EMEA at SSgA, said the European ETF market was "fragmented" compared with the US and offered "huge" potential of growth.

Eleanor Hope-Bell, head of the UK Intermediaries Business Group at SSGA, said the easiest and quickest way for pension professionals to start using ETFs was as a tactical tool. According to Hope-Bell, the key factors for pension professionals when it comes to investing in ETFs are cost effectiveness followed by liquidity, whereas fund managers most value liquidity.

The study also found that 45 per cent of pension professionals and 42 per cent of fund managers surveyed are seeking to increase their exposure to equity ETFs over the next five years, while 28 per cent and 19 per cent of them, respectively, will increase exposure to fixed income ETFs.

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