Derek Fulton, CEO of provider First Trust Global Portfolios, has called for ratings agencies to analyse exchange-traded funds alongside active offerings to give buyers a more transparent picture of the options available to them.
Speaking about the FCA's Asset Management Market Study, which criticised ratings agencies and best buy-lists for not highlighting all funds offering the best value for investors, the CEO said fund ratings should compare ETFs directly to active strategies. He said: "If you have a smart-beta ETF, the ratings agency would not rate it using the same system, so an adviser would not get a comparative rating. "If an adviser or DFM searches for the top funds, the list will not include ETFs because they do not rate them like that." Platform inefficiencies over real time trading threaten ETF...
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