2020 was another record year for the European Exchange Trade Funds (ETF) industry, with total assets under management topping US$1.3tn.
Against this backdrop and following the growing appetite of investors for ETFs, we would like to invite you to participate in the 14th ETF, Smart Beta and Factor Investing survey. This survey continues to analyse European investor practices, perceptions in terms of challenges and benefits, and future plans for investing into Exchange Trade Funds (ETF), with an increased emphasis on ESG investing for this 14th edition.
We would be very grateful if you or any of your colleagues would answer the questionnaire by clicking on the following link, the survey closes next Friday 9 April:
Your participation would be very valuable to the study. Completing the questionnaire should not require more than 15 minutes of your time and we assure you that your responses will remain both confidential and anonymous.
Here’s a selection of last year key findings about the current use and future development of ETFs, smart beta and factor investing strategies, as well as the integration of ESG within these products.
- In 2020, 49% of respondents are investing in SRI/ESG, a significant increase compared to 17% in 2011. Among them, 55% have used ETFs to invest in SRI/ESG in 2020 (33% in 2019), with a satisfaction rate of 87% (68% in 2019).
- Achieving broad market exposure still tops the list of reasons for using ETFs, with 77% of respondents using them frequently for this purpose.
- Cost and quality of replication are the two main drivers for selecting ETF providers (91% and 86% of respondents, respectively).
- About two-thirds of respondents (65%) have used ETFs to invest in smart beta in 2020, and 47% of smart beta and factor investing has been done through ETFs in 2020.
- 54% of investors still plan to increase their use of ETFs in the future despite the already high maturity of this market and high current adoption rates.
- Allowing for a positive impact on society (65%) as well as reducing long-term risk (58%) are the two main reasons why respondents incorporate ESG into their investment decisions. However, the majority (63%) do not want this to be done at the expense of weaker performance.
- More respondents (45%) favour a best-in-class (positive screening) approach to SRI/ESG implementation over the thematic approach (30%) and the negative screening approach (25%).
- Improving performance and managing risk are the two main motivations for using smart beta and factor investing strategies. Despite this strong level of motivation, 70% of respondents invest less than 20% of their total investments in these strategies.
- When asked about the smart beta solutions they think require further development by providers, respondents cited ESG, fixed income and alternative asset classes. They would also like to see more customised solutions developed.
If you have any further questions, please do not hesitate to contact Véronique Le Sourd, main author of the survey at +33 (0)493 187 830 or by email: [email protected].
Click here to access the EDHEC European ETF and Smart Beta Survey 2020.