A total 49% of investors would like to see more emerging market equities products brought to market, while 43% are looking for new emerging market fixed income ETFs.
Demand for these products is also reflected in inflows into existing emerging market equities ETFs, which increased five-fold between 2011 and 2012.
The survey found that half of investors use ETFs to access new asset classes, and they are also rated as the most diverse of products when it comes to offering exposure to a range of both asset classes and indices.
In terms of satisfaction in returns generated by ETFs, equities have been the most consistent, although there has been a slight decline in investor satisfaction with these products over the past year.
Satisfaction
Corporate bonds, government bonds, and hedge fund ETFs have also generated desirable returns over the past year, although satisfaction with the latter type has been the most volatile. This is likely to be due to the fact ETFs are best-suited to more liquid asset classes.
There has been a notable increase in both the number and range of infrastructure EFTs on offer, and as a result investors are viewing these investments more favourably than in the past. The opportunity to invest in geographically-specific funds, which has only been made available in the past year or so, has resulted in a sharp uptick in investor sentiment towards infrastructure products.
The demand for actively, or active/passive managed funds has increased by five percentage points over the past year, although the majority of investors, 72%, still want passively managed funds. The increased interest in actively managed funds is likely to be a reflection of the increased need for transparency and disclosure across these fund types.
Just over two-thirds of investors surveyed stated that they believed the ETF market would continue to grow, compared to the 28% who believe the futures market will further expand. The total return swaps market, however, is predicted to decline by 30% of investors.
