Brokers Enjoy ETF Upswing

by Peter Wakeford
Posted by Hannah on 11 December 2008
Brokers Enjoy ETF Upswing

The funds have been snapped up by investors hoping to take advantage of the recent market volatility.

Trading activity in Exchange Traded Funds (ETFs) is on the up, Barclays Stockbrokers has said.

According to the stockbrokers, the highest volume of the year so far for ETF trading was in October 2008, where volumes were 92 percent up over the previous month, while in September volumes had increased by 91.5 percent over August.

ETFs are a relatively recent innovation in the world of investment. As their name suggests, an ETF is an investment fund that is publicly listed on an exchange. Generally, they function as "index trackers", rising and falling in value in line with a selected stock market.

Therefore trading in the funds is a good way of taking advantage of market volatility - the level of which was almost unprecedentedly high over autumn 2008.

Barclays' own FTSE 100 tracker ETF was the most popular in its products suite over August, September and October - with the S&P 500 ETF in second place.

Barbara-Ann King, head of proposition at Barclays Stockbrokers, commented: "Market volatility has continued to dominate the headlines so it's encouraging to see investors capitalising on these movements to get the best returns.

"We have seen a significant increase in ETF trading activity over the past three months with purchases peaking on Friday October 10th when market volatility was at its height, this also shows how comfortable our clients are in trading ETFs in these market conditions."

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