Beyond the Future

The landscape for index vehicles is changing.

Futures – one of the traditional instruments of choice for institutional investors looking for beta – face headwinds driven by the increased cost of capital applicable to banks under the Basel framework and the Volcker rule. As a result, over the last 12-15 months, investors holding long, non-leveraged Futures positions might have experienced a noticeable increase in the cost of rolling their contracts.

In contrast, ETFs are increasingly gaining traction in their role as financial instruments offering greater efficiency through lower costs. In the recent Greenwich Associates Asia Pacific ETF Survey, 50% of ETF users in the study plan to replace an equity futures position with an ETF next year.

Why consider ETFs?

Lower Cost

Lower Cost

Growth of ETF industry has led to higher liquidity and greater cost efficiency

Operational Ease

Operational Ease

ETF offer operational ease and track benchmarks better over the long term

Precision and Choice

Precision and Choice

ETFs offer a sheer breadth of choice in terms of exposures - representing a very precise implementation tool for beta investors.

ETFs vs Futures Webcast

In our latest webcast, we discuss key fundamentals behind futures users switching to ETFs. We also share some case studies of clients and the exposures where they found it attractive to make a switch.

>> Watch Now

White Paper: ETFs as Financial Instruments

Is it time for investors to re-consider the vehicle used to access beta? How do ETFs compare?

>> Read More

Watch Our Video Series

Why are more investors opting for ETFs over futures? How are new regulations such as the Volcker Rule and Basel III affecting the cost of derivative products? In which ways do ETFs differ, and how are they performing globally? Do certain types of ETF pose liquidity risks that investors should be aware of?

In this series of videos, the Financial Times and iShares explore these questions in detail, debating the key differences between ETFs and futures, and the important factors investors should consider about these products.

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