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Morgan Stanley is entering the crowded ETF industry with six new products, including two actively managed ETFs. Steve Johnson reports in the Financial Times:
In a parallel universe Morgan Stanley might be Europe’s pre-eminent exchange traded fund provider. In this one it is the wet-behind-the-ears newbie, beaten to the punch by the more than 400 issuers globally that have already entered the ETF fray.
Despite its tardiness Morgan Stanley, the 18th-largest manager in the world with assets of $1.3tn, and the biggest without ETFs, has ambitious plans.
Six ETFs were unveiled in the US earlier this month, with many more in the pipeline. Europe is also on the radar, although the first launches are unlikely before 2024.
“[Our platform] will be multi-asset class, multi brand and multi jurisdiction,” said Anthony Rochte, global head of ETFs at Morgan Stanley Investment Management. “We are in the initial steps of building out a global ETF platform.
“There is client demand for both mutual funds and demand for ETFs. We are going to where our clients are.”
If it were not for a series U-turns, Morgan Stanley might already be established where its clients increasingly are: the fast-growing $9.8tn ETF market.
As far back as 1996 the bank developed a family of World Equity Benchmark Series (WEBS) ETFs in conjunction with Barclays Global Investors. Just four years later Morgan Stanley sold the business to BGI, which rebranded the funds as iShares.
The rest is history, with BlackRock buying iShares in 2009 and building it into a $3tn juggernaut, the biggest ETF shop in the world.
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