I'm live all day at the IndexUniverse.com Inside ETF Conference in Hollywood, Fla. This is the largest gathering of the ETF industry: over 900 investment advisors are here, along with all the industry players — Vanguard, Schwab, iShares, ProShares.
With over $1 trillion in assets, the ETF business is rapidly growing up. Many here expect ETFs to hit $2 trillion in assets in the next couple years. Why? Low cost and broad exposure to many different markets and asset classes.
But that doesn't mean there aren't issues.
In my discussions with investment advisors here, I can tell you that the enthusiasm for ETFs are undiminished, but there is an increased awareness that they must be vigilant — they want to make sure their clients are invested in ETFs that are appropriate for their clients' risk profile, and that the investment advisors themselves are aware what the ETFs (particularly more exotic ETFs) do and that they perform as they are advertised.
We are also discussing:
1) why the ETF industry is growing so rapidly
2) what new products will be out in 2011 (copper, aluminum ETFs coming in a couple months!)
3) where the hot money is going
4) how the industry is responding to allegations that ETFs were a factor in the Flash Crash.
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