Listed products have changed the investment platform and management game forever, says ETF provider BetaShares as it launches two active ETFs with Legg Mason.
The two firms formally launched the BetaShares Legg Mason Equity Income Fund (ASX: EINC) and BetaShares Legg Mason Real Income Fund (ASX: RINC) yesterday, both of which are managed by Legg Mason affiliate Martin Currie and began trading on the exchange this week.
Speaking at the listing ceremony at the ASX in Sydney yesterday, BetaShares managing director Alex Vynokur said the ETF boom is here to stay, with major implications for incumbent fund managers and platform providers.
“The true innovation [in ETFs] is the access to the customer - the ability to deliver to the customer an investment outcome in a cost-effective, simple way which really aligns with the way that people are investing in this century as opposed to centuries before,” Mr Vynokur said.
“The idea of filling out a lengthy application form and PDS or signing up to an expensive platform in order to access an investment strategy … I think those days are well and truly over.”
Mr Vynokur – whom the ASX’s custom publication recently described as the “far from passive ETF king” – also suggested that the Legg Mason strategic partnership may see the end to traditional animosities between active and passive managers.
“We have been passionate about index investing for a long time, but ultimately our belief is that investors have choice and that includes active investment tools,” Mr Vynokur said.
“For many years the debate has really been a very antagonistic one. Passive managers have sought to talk down the active management industry and similarly active managers are pointing to the gaps of what passive can offer.”
Legg Mason Australia managing director Andy Sowerby said the partnership makes use of cutting-edge product innovation and will be well-suited to “planners and advisers”.
However, he added that Legg Mason would not be abandoning its traditional investment philosophy.
“We are unashamedly an active manager,” he said. “We believe we can add real tangible value.”
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