Scientific Beta

Funds Europe: "Investors are keen on smart beta ETFs, says Felix Goltz of the EDHEC-Risk Institute, who illustrates the popularity of investment factors. But investors also place demands on their providers, including evidence that alternative beta works."

Funds Europe June 2015

"(…) Investors are keen on smart beta ETFs, says Felix Goltz of the EDHEC-Risk Institute, who illustrates the popularity of investment factors. But investors also place demands on their providers, including evidence that alternative beta works. It appears that investors show considerable interest in smart beta exchange-traded funds (ETFs) and have strong requirements for them. A quarter of respondents to the EDHEC European ETF survey 2014, supported by Amundi ETF & Indexing, already used products tracking smart beta indices, and 40% of them do not currently invest in such products but are considering investing in them in the near future. The fact that there are more respondents who are considering an initial investment than there are actually investing implies that we are likely to see strong growth of usage of smart beta ETFs in the future. Moreover, when asked about their priorities for future product development in the ETF space, smart beta ETFs dominate the list of items mentioned by investors. In fact, among the six biggest priorities seen by investors, four concern indices relating to smart beta approaches, namely smart beta equity (37%), equity factor (31%), equity style (29%), and smart beta bond (25%). The remaining two items concern emerging market ETFs for stocks (43%) and bonds (27%). (...)"