Fund buyers warn on potential pitfalls when investing in income ETFs

Amid rising popularity of products

Fund selectors have cautioned investors could be getting "unexpected exposures" when investing in income ETFs, following a plethora of launches.

ETF providers have been keen to offer low-cost solutions for income-hungry investors, with a number expanding their ranges in recent months to encompass UK-focused as well as global offerings. Last month, Lyxor added to its income ETF range with the launch of a Japanese product, while BMO GAM rolled out three enhanced income ETFs in July. These products have also been popular with investors, with Lyxor's income ETFs attracting €293m so far this year, compared to €184m for the whole of 2016, while the BMO MSCI UK Income Leaders UCITS ETF saw a 37% AUM increase.  Concerns  However,...