I came across a really interesting article he published at Advisor One the other day about five ETF “megatrends” for the coming year and I agree with virtually all of his predictions/insights.
In particular, I think the idea that traditional actively-managed mutual funds will continue to re-wrap themselves as ETFs is the big one, it’s something I predicted in Fortune Magazine a million years ago (see: The End of Mutual Funds is Coming)
Anyway, here’s Ron’s take on the trend:
Mutual Fund Providers Invade ETF Market
Brisk activity in SEC filings for proposed ETFs in the final month of 2012 shows that several big hitters in the mutual fund world plan to make their impression in the ETF marketplace.
T. Rowe Price, according to filings, plans to launch its first ETF–an active total return bond fund that emphasizes income. The proposed ETF is called the T. Rowe Price Diversified Bond ETF, and the fund would apply the company’s proprietary selection method, based upon the firm’s fundamental and quantitative research.
Along similar lines, Franklin Templeton revealed plans to introduce an actively managed ETF that holds short-duration government bonds. The proposed fund is named the Franklin Short Duration Government ETF and it will own a diversified basket of short-duration, fixed-income securities issued by the U.S. government and related agencies.
Although not new to the ETF market, another noteworthy trend is an ETF menu expansion by Fidelity Investments. The company is planning to offer the Fidelity Corporate Bond Fund, along with a series of other actively managed bond.
Get over to the article for the other four trends, it’s a good read.