ETF Market Will Carry On With Upward Trajectory, Hit $1.95 Trillion By 2010 Celent Report Says

Exchange traded funds can expect to see massive growth over the next 10 years, a new Celent report says. Fueled by an increase in the diversity of investors who are devoting money to ETFs, combined with a wider range of

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Exchange traded funds can expect to see massive growth over the next 10 years, a new Celent report says.

Fueled by an increase in the diversity of investors who are devoting money to ETFs, combined with a wider range of products, Celent predicts in their report titled “ETFs-All Aboard! Are ETFs Gaining on the Mutual Fund Industry?” that the ETF market will exceed $1.95 trillion by 2010 with an annual growth rate of 33% between 2006 and 2010.

“Exchange-traded funds are experiencing rapid growth due to the actions of a wide variety of market participants,” says Denise Valentine, senior analyst and author of the report. “They may be used in combination to create a diversified core portfolio or as components to provide further diversification into segments such as small-caps or commodities. Still others may use the vehicle for strategies such as tactical asset allocation, tax management, transition management, or short-term trading.”

While Celent says it doesn’t foresee ETFs dominating the US mutual fund market in coming years, it does say that ETFs have gained a solid foothold.

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