U.S. asset managers are moving away from Standard & Poor’s, Russell, MSCI and other established index providers to develop indices for their passive products, Financial Times reports. A growing number of ETF sponsors are entering the index construction segment owing to fee pressure, product development demands and a rise in interest in alternatively weighted indices.
IShares and John Hancock have lately sought approval to launch ETFs based on indices developed by their respective parent companies, BlackRock and Manulife. IShares is also planning to self-calculate its indices, further cutting out other index providers. ETF sponsors that have already entered the index construction business include WisdomTree, Van Eck, IndexIQ and Guggenheim Funds.
Click here for the story from Financial Times.