Passive funds on the front foot in Asia
With actively managed funds falling woefully short of their targets, passive products have the chance to finally overcome the reticence of Asian investors. Regulatory changes could help.
On July 1 Hong Kong’s exchange-traded funds market experienced the ‘Vanguard Effect’. Ironically, BlackRock initiated it. The world’s largest fund manager and provider of exchange-traded funds heavily slashed the fees on two of its ETFs listed in the city, in an apparent attempt to attract more investors.
The Vanguard Effect refers to the eponymously named fund manager instigating a cost war by cutting fees on its ETFs or index funds. True to form, Vanguard was quick to counter it…
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