Coming soon: A trade group just for ETFs

The founder of the No-Load Mutual Fund Association — now The Mutual Fund Education Alliance — hopes to announce the creation of a new organization representing exchange-traded funds next month.
“At this juncture, the ETF industry needs to have its own home base,” Irving L. Straus, chairman of Straus Corporate Communications, told InvestmentNews.
A number of leading ETF providers have agreed to become members of this organization — known as the ETF Council Inc. — although he declined to identify the firms, because they have not yet given Mr. Strauss permission to reveal their names.
Recent events, such as the regulatory scrutiny that leveraged and inverse ETFs have come under, highlight the need for the ETF industry to have its own trade organization, Mr. Straus said.
Currently, ETF providers are represented by the Investment Company Institute. But the ICI focuses primarily on mutual funds, Mr. Straus said.
“They aren’t going to be proactive marketers of the ETF business,” he said.
Of course, many ETF providers also offer mutual funds.
It’s a fact Mr. Straus admits has slowed his efforts to create his proposed trade organization.
The ETF organization, however, would complement the ICI, not compete against it, he said.
“In order to make the case for leveraged ETFs, you don’t have to pick on mutual funds,” Mr. Straus said.

Related Topics: Investment Company Institute (ICI)