Asset managers lose out to ETFs

Exchange-traded funds (ETFs) and trackers are becoming more popular as investors spurn management fees for better value. That's good news for savers, says Paul Amery.

Fund managers are getting "ETF'd", the head of sales at Ignis told the FT this week. The asset management business is going the same way as food retail. Bargain retailers Lidl and Aldi are going great guns, as is Waitrose at the top end of the market. The middle, Sainsbury's and Tesco, is getting squeezed.

Similarly, fund managers are increasingly split between a few large providers of cheap, passive index trackers such as exchange-traded funds(ETFs) at one end, and smaller, active players at the other.

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Paul Amery

Paul is a multi-award-winning journalist, currently an editor at New Money Review. He has contributed an array of money titles such as MoneyWeek, Financial Times, Financial News, The Times, Investment and Thomson Reuters. Paul is certified in investment management by CFA UK and he can speak more than five languages including English, French, Russian and Ukrainian. On MoneyWeek, Paul writes about funds such as ETFs and the stock market.