by Leonard Kehnscherper
JPMorgan Chase & Co.’s asset management arm is partnering with Dutch online broker Bux to sell its active exchange-traded funds in customized model portfolios, as the Wall Street giant looks to break further into Europe’s retail market.
Bux, which is owned by ABN Amro Bank NV, will be offering the portfolios to subscribers to its “prime” service, which is available for a flat fee of €7.99 ($9.1) per month, the firms said in a statement on Monday. JPMorgan AM’s multiasset solutions team has designed the portfolios, which are based on more than a dozen of its ETFs, Travis Spence, the firm’s global head of ETFs, said in an interview.
The partnership seeks to provide elements of discretionary fund management services, traditionally reserved for high-net-worth individuals, to a broader investor base, said Bux Chief Executive Officer Yorick Naeff. He added that investors will need at least €20,000 ($23,120) in invested assets within its “prime” service to effectively pay a lower fee than they would with a provider that charges fees based on account size.
With the offer, Amsterdam-based Bux is looking to take on European investment platforms like Trade Republic and BlackRock Inc.-backed Scalable Capital, which provide passive ETFs within popular savings plans — a German invention that lets retail investors put regular, small sums into the product.
US and European asset managers from BlackRock to DWS Group and Aberdeen Group Plc have all been rushing to grab a chunk of Europe’s rapidly expanding active ETF market. The industry is expected to grow to $1 trillion in assets by 2031 from less than $100 billion at present, according to London-based HANetf, a white-label company that helps asset managers launch ETFs.
While active ETFs in the US are more often bought directly by retail investors, distribution in Europe is dominated by intermediaries such as banks and wealth managers.
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