Markets
Spurring ETFs’ trading growth
Cheah Chor Sooi | 13 Oct 2017 00:30
Lack of appeal to investors has persistently stunted the growth of ETFs in Malaysia, says Goh
The true potential of exchange-traded funds (ETFs) can probably be best “unearthed” with the participation of big-time institutional investors.

Currently, the level of understanding regarding ETFs among retail investors remains low while at the institutional level, most assets managers do not include ETFs in their portfolios.

An ETF is essentially an open-ended fund – much like a unit trust – but is listed on the stock exchange. Howover, it does not impose sales charge and has lower management fees (less than 1% compared to managed funds).

Moreover, fund managers – unlike those in more developed markets – generally prefer an active stock-picking approach rather than utilising a core or satellite strategy using ETFs, according to i-VCAP Management Sdn Bhd acting CEO Zulkifli Ishak.