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ETF & Indexing
Traditional active managers are facing increasingly challenging times. Assets are flowing from active funds into alternatives, index funds and ETFs as investors take a “barbell” approach to asset allocation.
Asset managers must develop and implement appropriate strategies to succeed in this new investment paradigm. Index strategies and ETFs are increasingly being adopted by asset managers looking to position their businesses for success.
How we work with clients
Through our unrivalled experience and insight, we help clients deliver their investment insights and DNA through index strategies and ETFs.
Our work includes:
- Product Development: We help asset managers deliver elements of their IP and DNA systematically through index funds and/or ETP structures; reducing costs, delivering value and opening up new distribution channels
- Technology: Indexing and ETF capability requires development of front office process and technology. Alpha’s deep specialisms in front office IT, and index and ETF best practice, enables us to deliver client specific technology solutions quickly
- Outsourcing: Choosing the right service providers, vendors and capital markets partners to support your index and/or ETF platform is vital. Alpha’s extensive knowledge of outsourcing partners, vendor capabilities, and capital markets enables us to select and onboard the most appropriate firms quickly and at reduced cost
- Delivery: Our team is made up of industry experts who have worked at leading index and ETF firms. We have built and launched ETF platforms and have first-hand experience of accelerated delivery with robust risk mitigation
Why Alpha?
We are uniquely placed to help clients realise their ambitions in this space. Our focus on the asset and wealth management industry mean we have deep specialism in the areas that support the delivery of index and ETF strategies.
By establishing a dedicated Index and ETF practice with industry practitioners, we hope to be at the forefront of development in what is a pivotal time for the industry.
Q&A with Marc Knowles, Head of ETF & Indexing
What's driving the trend towards the use of ETFs?
Investors are increasingly looking for low-cost, transparent investments that provide value for money. The majority of active strategies have failed to deliver consistent long-term performance and at higher fees. Investors understand that they can enhance returns by applying an active asset allocation approach using low-cost index and ETF building blocks. Furthermore, Index and ETF strategies can deliver both alpha and beta exposure within a portfolio.
What are the biggest opportunities for asset managers?
Active managers should look across their existing product range, determine where they are delivering value through fundamental active management and identify strategies that could be revitalised by delivery through an index approach. Furthermore, index funds and ETFs can open new distribution channels for managers.