More than two-thirds of Australian institutional investors believe ETF use will become more prevalent among their peers in coming years, according to a new survey.
A survey of 35 institutional investors by VanEck has indicated that the largest Australian investors are willing to increase their exposure to ETFs.
The Australian VanEck Institutional ETF survey was conducted in February 2017 and included responses from seven industry funds, five retail funds, 11 asset managers and four asset consultants.
The survey found that over half (55 per cent) of respondents are currently using ETFs in their portfolios, and 70 per cent believe ETFs will become "more prevalent" in coming years.
For the institutional investors not currently using ETFs, 53 per cent said they would "probably" use them in the future.
The major stumbling blocks for institutions when it comes to ETFs are primary market liquidity, secondary market liquidity, lack of depth in the market and a restriction to only investing in indices.
Two-thirds of Australian institutional investors are using ETFs to access Australian equities, international equities and fixed income.
The key uses of ETFs by institutions are strategic asset allocation, tactical asset allocation and cash equitisation, according to the survey.
A majority of Australian institutions make ETF trades of below $10 million, while 6 per cent of institutions use them to make trades of between $200 million and $500 million.
Read more:
New ASIC guidance released for REs
Legg Mason hires key account manager
HHV shareholders advised to reject WAM offer
The online platform provider HUB24 has continued to grow quarter-on-quarter with the end of 2018 being the best yet for the company. ...
Three of the big four banks have been found to increase their financing of fossil fuel energy over the past year, despite all promising to s...
The upcoming federal election has led the government to ramp up its criticism of the opposition’s economic agenda, warning Australians tha...
