Inside ETFs: What Was Everyone Buzzing About?

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At the end of January, Joe Anthony and I, along with 1,800 ETF industry participants, descended upon Hollywood, Fla. for the annual Inside ETFs Conference.

We were given the opportunity to “geek out” over the newest trends, key players and the future of this industry, which I believe is still in its infancy. There seems to be so much potential in terms of new products and strategies.

Between the panels, networking events and one-off conversations with attendees, several themes and topics came up over and over again. Which ones were most prevalent?

I thought it would be helpful to share five buzzwords from my inaugural Inside ETFs conference experience:

  1. Bitcoin – It’s a topic that has the investment community divided, and that sentiment certainly played out at Inside ETFs. One of the panels that it seemed everyone wanted to attend was the Q&A with Tyler and Cameron Winklevoss (yes, those Winklevoss twins).

They were there to defend and promote the Winklevoss Bitcoin Trust, a soon-to-be launched Bitcoin ETF. Moderator and Reuters reporter Jessica Toonkel pulled no punches, leading off by asking them, “Why do we need a Bitcoin ETF?”

The answer? Jury is still out, though the Winklevii made a very compelling argument about the product being a way to access the currency and bitcoin’s role as a payment method.

 

  1. Roboadvisers – It was a battle of young versus old down in Florida when it came to roboadvisers. They’re touted as the investment solution for Millennials. During one of the keynotes, it was argued that roboadvisers are going after Gen Y and Z in the same way that Schwab went after Boomers who were beginning to acquire wealth in the 70s.

Love ‘em or hate ‘em, it seems like roboadvisers are not only here to stay, but they’re a sector of the industry that will continue to grow; in fact, as one of the ETF.com editors argued (check out the tweet below), Schwab is essentially getting in on the action with Schwab Intelligent Portfolio.

 

  1. M&A – As Joe Anthony predicted a few days before the conference, we are in the early phase of what is shaping up to be a series of ETF-related acquisitions. As the industry grows, so too will the interest from some of the biggest movers and shakers in the financial space.

To wit, ETF Issuer Solutions (ETFis) announced – while at the conference in Florida, no less – that Virtus Investment Partners acquired a majority interest in ETFis.

 

  1. Smart beta – This was a term that, as far as I could tell, was uttered during almost every panel discussion. Dare I say, smart beta is the new black?

So what is smart beta, exactly? It seems like it’s impossible to explain in only a sentence or two because it’s such a broad term and applies to so many different strategies, especially with ETFs.

One of my favorite discussions at the conference was the panel titled The Crystal Ball: The Future of ETFs. Check out what Joel Dickson from Vanguard had to say about smart beta (via CNNMoney reporter Matt Egan’s tweet):

 

  1. Income – With interest rates low, the investment world as a whole is constantly wondering how to generate income. Therefore, it’s no surprise that Inside ETF attendees made this a component of many discussions.

Income-generating products are constantly being scrutinized and evaluated. As one of the Crystal Ball panelists mentioned, most investors want to make decisions about a diversified basket of bonds. That means there is certainly a place in the industry for fixed income ETFs and others in that family.

The tweet below came from the Women in Inside ETFs breakfast discussion.

Narrowing the Inside ETFs buzzwords down to just five was pretty difficult. Others on my list that didn’t make the cut? Nontransparent active ETFs, Europe, oil and the Fed.

What will be on the ETF industry’s mind in 2016? Only time will tell.