A study commissioned by ETF issuer Lyxor suggests that fund managers will increase their use of exchange-traded products.

Of the 131 managers surveyed in April 2012, 54% said that they expected to increase their use of ETPs during the next three years, 44% said their ETP usage would stay the same and only 2% said they would use the tracker products less.

Despite the concerns expressed by some about the risks inherent in ETPs, only 6% of the survey respondents were ‘very concerned’ about the risks posed by these products, says Lyxor.  However, seven out of ten (69%) said that as much due diligence resource should go into selecting ETFs and ETPs as traditional mutual funds, Lyxor points out.

When asked to point out the three most important factors to consider when selecting an ETP, fund managers named tracking error, liquidity and counterparty risk as their primary selection criteria.

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