Adviser ETF sentiment slowly changing
Some financial advisers who regarded the growth of exchange-traded funds (ETFs) as cyclical are starting to change their position, according to a report published by ETF Consulting.
ETF Consulting's Australian ETF Outlook reported anecdotal evidence that some advisers are realising that the rise of these products could represent a permanent structural, rather than cyclical, change.
According to the report, the so-called "ETF debate" polarised the financial advice industry into two distinct camps.
One camp is of the view that the growth of ETFs is merely cyclical - a phenomenon made popular in the last five years of volatile markets.
The other group tends to hold the opposite view that the ETF revolution will fundamentally and permanently change financial services, wealth management and advice.
"This is supported by external drivers in addition to the…cost, liquidity and product dissatisfaction [factors]," the report said.
"Regulatory change locally and globally driving improved behaviours, continued growth of self-managed super funds and a fundamental shift in the unbundling of services support this view."
However, ETF Consulting reported anecdotal evidence identifying a growing consideration of ETFs by some in the so-called cyclical camp.
"Those splitters are lending a more open ear and mind to ETFs and how they might be complementary to their business," the report said.
"Whilst not currently using, they are more considerate of the what, why and how of ETFs."
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