Coming of age

As Australia braces itself for a shift to a fee-for-service regime for financial advisers, low-cost, relatively transparent products such as exchange-traded funds look set to flourish. Wietske Blees reports

The global financial crisis has acted as a catalyst for change for Australia’s nascent exchange-traded fund (ETF) industry. During the past year, the market – which has long struggled to gain traction in an investment environment traditionally geared towards actively managed funds – has multiplied by a factor of 2.5 times as Australian investors pile into low-cost, diversified investment opportunities. In the 12 months to February 2010, the market capitalisation of Australia’s ETFs rose from A$1