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Matthias Knab, Opalesque: In recent years, the market in exchange-traded funds (ETFs) has grown rapidly, both in Europe and globally. In a study of the French ETF market, the AMF analyses this growth's consequences on market liquidity and stability.
Under the influence of investors searching for yield and low-cost products, the ETF market has grown significantly, with global assets invested in these products increasing yearly by 20% over the past four years. ETFs now account for more than Euro 2,850 billion in assets under management, or 7% of all collective investment assets globally. The scale of this market, as well as events such as the United States' 'flash crash' in the summer of 2015, where American ETFs suffered severe disconnects, raise questions as to the associated risks to market liquidity and stability.
Alongside work undertaken at the international level, the AMF was keen to shed light on these questions by focusing its study on the French market (ETFs listed on Euronext Paris). The market in ETFs listed on Euronext Paris consists of 477 funds with total assets under management of Euro 103 billion at end 2016 (up 66% versus 2014). Following an assessment of the current state of the market and a description of the associated risks, ...................... To view our full article Click here
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