Zenith moves to rate ETFs
Research house, Zenith Partners, has launched a specialist arm dealing with exchange traded funds (ETFs).
The company launched its ETF capability by providing a rating to a new ETF managed by Russell Investments and Zenith director, David Wright said he expected increasing client demand for ETF products.
He said that following on from the Russell review Zenith would release other ETF ratings and these would be supported by a comprehensive sector report.
Wright insisted that Zenith would apply the same investment criteria used in its unlisted managed funds research to the ETF landscape “with sub-standard providers being filtered out of our process”.
However it outlining its view of ETFs as a product, Zenith said that while there was clearly increased interest and demand for ETFs, the company believed advisers and investors’ understanding of ETF pricing structures and operational processes was not extensive.
“For example, there are potential withholding tax issues, not only with offshore ETFs, but a number of locally-domiciled vehicles as well,” the ratings house said.
Zenith handed the Russell High Dividend Australian Shares ETF, which was launched in May, a “recommended” rating.
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