BlackRock's Parkin and Li: Changing attitudes to smart-beta investing

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Joe Parkin, head of iShares UK wealth and retail, and Wei Li, head of iShares EMEA investment strategy at BlackRock, have predicted factor investing to be the significant growth area for the asset management industry due to an evolution in the way clients invest.

Speaking to Investment Week, Parkin said the introduction of the Retail Distribution Review and MiFID II have led wealth managers to look at breaking down core equity exposures rather than looking for wider products.  For example, wealth managers no longer simply want exposure to the US, but instead would like to implement sector biases and more granular positions, Parkin said. Rising regulation along with the increasing availability of data, as well as providers' ability to capture factors and put them in a benchmark, were all driving investors towards smart-beta products, he added. ...