I chaired three panels of speakers celebrating the wave of innovation in ETFs and in ETF distribution on the first main day of the much-loved Fund Forum event.
We opened with Rob Oliver of Global X, Jean Maunoury of iM Global Partner and Rob Edwards of Morningstar discussing new products in the ETF space, with Oliver focusing on the rise of buffer strategies in Europe, Maunoury taking us through the managed futures in an ETF format space and Rob Edwards commenting on the convergence of private and public markets which he predicts will see growth in investor appetite for private markets replicated in the UCITS ETF format, three to five years down the road.
Next up was our panel on those disruptive distributors neobrokers and roboadvisers across Europe, with panellists Wail Azizi of Equiduct, Gerry Perez of Interactive Brokers, Jan Jursa of Finax and Timo Slametschka of Scalable Capital discussing the appetite for ETFs through savings plans or as direct investments among the younger investors across Europe. Azizi reported that the Equiduct data revealed the rise of a growing group of sophisticated investors, reacting to live events by moving in and out of ETFs and employing day trader techniques with short and leveraged products. Finax’s Jursa said that for his firm, located in Eastern Europe, it’s all about the education as private investors discover ETFs, while Gerry Perez of Interactive Brokers noted that there are still regulatory and geographical restrictions across the fragmented European market. Slametschka noted that two thirds of their clients at Scalable Capital were in ETFs and some 50 per cent were in savings plans.
Final panel for the day for me, was with three ETF selectors: Henry Cobbe of Elston Consulting, Ernst Knacke of Shard Capital and Jim Wiandt, representing his family office and his new venture, Stack Ventures.
Trackinsight’s Julien Scatena introduced the ETF subject reporting on the firm’s latest survey and noting the rise of active ETFs which now represent 30 per cent of ETFs. Cobbe called for more innovation from ETF providers and celebrated the BlackRock iBonds products, while Knacke explained how investing in managed futures ETFs works for their clients. Wiandt recounted his lengthy experience in the ETF industry and its unprecedented growth and expansion into new sectors such as cryptocurrencies, with the astounding wave of bitcoin ETF launches last year in the US and all the panellists commented on the growth in defence ETFs, a reflection of the current geo-political situation.
Elsewhere, ARK Invest’s Cathie Wood spoke about how AI is driving the convergence of the firm’s hotly predicted next five megatrends. “AI is the biggest catalyst,” she said, with the rise of Chat GPT giving everyone the taste for AI and for them to find out how empowering it is and how fast the world is changing.
“The history of technology is that it is a net job creator,” she said. “Baby boomers are retiring and fertility rates around the world are so low we are going to need more automation and AI is part of that movement.”
Specifically, she commented on the rise of autonomous taxi networks, using AI, predicting that over the next five to 10 years the entire eco system associated with robo-taxis will scale to USD8-10 trillion dollars from essentially nothing now.
“Once human driving is less safe than autonomous driving it will happen fast,” she said.
Health care has long been a key part of ARK’s research with Wood noting that multiomics should improve in performance by orders of magnitude by 2030.
“The time to bring a drug to market will drop from 13 years today and in five years, to eight years and it could go down to five years while we will see the rise in molecular diagnostic testing. The reason this is happening today and not in the late 90s was that back then it cost USD2.7 billion dollars to sequence one person’s genome and now that’s down to USD200 dollars.”
