While I’m still keeping up ETFolution at Forbes, I’ve been tied up by a few big stories and other projects.
The first was a profile in Forbes magazine on Reggie Browne, the head of ETF trading at Knight Capital. Reggie has spent most of his career trading derivatives and now ETFs. At Knight, along with his business partners, he has built a business that surrounds ETFs and is looking to grow along with the success of the structure. While securities trading shrinks, Reggie’s expectation is that the market for ETFs will continue to grow. Despite recent fund closures, inflows into ETFs are on a record pace in 2012.
Next, I helped put together a feature and data package on ETFs for the Wall Street Journal. Trying to identify five trends that would rule the ETF market for the next five years was a tough assignment, but I think we’ve hit on some consensus. Read the story for details, but one aspect that I didn’t add was a mix of new entrants and consolidation of smaller firms. Financial services, over time, tend to consolidate as technology increases competition and reduces margin.
The ETF market is experiencing these phenomena in earnest right now.