Olivier Paquier, Head of Continental Europe ETF Distribution at J.P. Morgan Asset Management, explains why fixed-income ETFs will boost growth in the overall ETF market
The macro environment is not easy to navigate and in the coming months investors will have to find ways to diversify and protect their portfolio from market volatility. In that context, alternative ETFs can be a nice addition to the palette of products available in the market, focusing on the liquidity aspects offered by the ETF wrapper.
Fixed-income ETFs, either passive, smart beta or active, are still in their infancy. The offer is rapidly growing and we think they will play an important role in the growth of the ETF market overall. Fixed income AUM has grown at a rate of over 26% over the last five years and we think this will continue, or even accelerate, over the next five to ten years.
At J.P. Morgan, we are building out a strong ETF business which leverages the best of our active, smart beta and plain vanilla capabilities to serve different client needs over the next three to five years.
We are doing this because sophisticated investors across Europe have told us they want to see innovation across a range of asset classes. What's more, these investors are on the lookout for strategies that can provide diversification benefits in their portfolios. The ETF wrapper, and the liquidity it delivers, is providing a suitable answer to this need.
Click here to learn more about J.P. Morgan Asset Management's fixed-income ETFs