London Stock Exchange Sees Boom in ETFs

by Peter Wakeford
Published on 23 April 2009
London Stock Exchange Sees Boom in ETFs

The funds are growing in popularity among investors, according to experts at the organisation.

Exchange Traded Funds (ETFs) are enjoying a stellar period of trading in otherwise quiet markets, the London Stock Exchange Group has confirmed.

According to a new report from the organisation, there are now 200 ETFs on offer for investors, with 19 having been added to indices in 2009 alone. More broadly, ETF trading was found to have increased 26 times over since the funds were first introduced in 2000, with £12.2 billion registered so far this year.

The funds generally work in a similar way to index trackers, a type of traditional fund which rises and falls in value in line with an index such as the FTSE 100. However, an ETF differs from these funds in that they can be bought and sold on an index in the same way as a share, increasing investor convenience.

Pietro Poletto at the London Stock Exchange Group added: "At [a] time when equity markets are perceived as being quiet, the ETF market has continued to expand, with very strong trading activity and regular new product issuance."

FTSE 100 trackers are the most popular ETF among UK investors. Exchange Traded Commodities, which track oil and other commodity prices, are also available.

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