ETF usage in model portfolios shoots up
Exchange-traded fund (ETF) usage in model portfolios is exploding, with OneVue noticing that ETF investment on its unified managed account platform has more than tripled over the last nine months.
More than half of all of OneVue's ETFs are now being held in separately managed account (SMA) portfolios, according to chief executive of strategic relationships Brett Marsh.
Investors are allocating more funds to growth assets over defensive assets, and a portion of that money is going into the ETF space, Marsh said.
"The growth that we have experienced at OneVue since July last year has largely been on the back of the increase in ETFs that are taken up in SMAs," Marsh said.
Marsh said ETF growth within SMAs would increase as multi-asset class SMA models increase in popularity. They provide more choice and flexibility, he added.
However, there was still also ETF growth in OneVue's managed funds wrap, Marsh said. ETF volumes have recently surpassed volumes on OneVue's managed funds wrap.
OneVue will continue to add ETFs on to its unified managed account (UMA) as they grow in the market, Marsh said.
There are approximately 70 ETFs available on the OneVue UMA.
Recommended for you
The possibility of a private credit ETF is looking unlikely for now with US vehicles seeing limited uptake, according to commentators, but fixed income alternatives exist that can provide investors with a similar return.
Ahead of the approaching end of the financial year, State Street has shared five tips for advisers who are using ETFs in their client portfolios.
The use of active ETFs in model portfolios by financial advisers is a key factor in the growth of the products for iShares, according to BlackRock.
Global asset manager BlackRock has identified bringing private markets to the wealth channel as a key business area for the firm that could generate US$500 million in revenue in the future.
