Growth Alert: ETFs

Exchange-traded funds have been one of the rare beneficiaries of the global downturn and seen increased investor interest and asset volumes swell in the last year. And, as more firms look to enter the market, there are likely to be job opportunities.

In Europe, ETF assets rose from €91bn to €113bn last year, according to Barclays Global Investors, the largest provider of ETFs through its iShares brand.

In the US, meanwhile, investors poured more than $80bn into ETFs in the December 2008 and January this year alone, according to figures from National Stock Exchange.

Low operating and transaction costs make EFTs cheap. They're also increasingly liquid.

Chris Sevenoaks, leader of the asset management division of Pure Executive Search and Selection, says: "The roles currently being created are around product development, as the funds become more complex."

He adds that ETFs are also looking for business development professionals, and sales people.

Growth is being driven by expansion of the ETF product range. Historically, ETFs were based around stocks and bonds. In the past three years, however, their range has broadened to include things like currency ETFs, commodity ETFs and leveraged ETFs.

There's also the possibility of new entrants to the market. ETFs were traditionally issued by a small group of institutional players such as BGI, State Street, Lyxor (part of Societe Generale) and Deutsche Bank. However, this could change.

"I can see many other fund management houses moving into ETFs in a big way," says Amin Rajan, managing director of fund management research firm CREATE. "As long the low nominal return environment continues, I think growth will carry on, but it will be more subdued if things change any time soon."

Sevenoaks says that senior business development roles around ETFs can pay between 75-100k base and up to 220k total comp.