Fidelity has announced that its FundsNetwork funds platform will be adding an initial range of 50 physically-backed ETFs as of 18 June. The move is reflective of growing interest in ETFs and the upcoming introduction of the Retail Distribution Review (RDR).
David White, Head of FundsNetwork.
The initial line-up of 50 ETFs has been selected from the ranges of four leading ETF providers, namely iShares, Credit Suisse, HSBC and ETF Securities, and provides exposure to a broad range of global markets and asset classes
Whilst the initial line-up covers all the main investable areas, including developed and emerging market equities and fixed income, REITs and gold, the exclusion of swap-based synthetically-replicated ETFs has resulting in the omission of some of the industry’s lowest-cost products, such as those offered by Amundi, Lyxor and DB X-trackers.
That said, the range includes some highly competitively priced products, especially when compared to actively managed mutual funds – traditionally FundsNetwork’s staple fare. Examples include the HSBC S&P 500 ETF (HSPX) with a TER of 0.09% and the iShares FTSE UK All Stocks Gilt (IGLT) with a TER of 0.20%.
The ETFs will be available alongside all of the other funds on the platform in a fully integrated way, with FundsNetwork providing advisers with a single view of their clients onshore, offshore and ETF holdings. All trading for ETFs on the platform will be carried out using JP Morgan’s execution service.
The addition of ETFs follows the announcement at the end of March that FundsNetwork was the first major platform to launch unbundled pricing alongside its existing bundled pricing model.
Commenting on the forthcoming introduction, David White, Head of FundsNetwork, said: “When we launched our unbundled pricing capability in Q1 we committed to delivering the first range of ETF investments in Q2. Advisers told us that physically-backed ETFs were their preference and so we have selected four leading providers in this space, providing access to a broad range of market indices and commodities. We will look to add further ETFs over the course of the year.”
John Chapman, Managing Director at Torquil Clark, a leading firm of independent financial advisers, added: “It’s a progressive step to add ETFs to the platform with a separate explicit charge. The integration of such instruments is an indication of a broadening proposition prior to the introduction of RDR. Physical replication is also perceived as being less risky than synthetic exposure.”
A similar such move was made by Barclays Stockbrokers, who last month announced the relaunch of its service for the intermediary market partly in response to growing demand from IFAs for access to ETFs.
The initial 50 ETFs available from 18 June are as follows, with additional ETFs and providers expected to be added throughout the year:
Credit Suisse
CS ETF (IE) on FTSE 100
CS ETF (IE) on MSCI Australia
CS ETF (IE) on MSCI Europe
CS ETF (IE) on MSCI Japan
CS ETF (IE) on Japan Small Cap
CS ETF (IE) on MSCI Pacific ex Japan
ETF Securities
ETFS Physical Gold
ETFS Physical PM Basket
HSBC
HSBC FTSE 100 ETF
HSBC FTSE 250 ETF
HSBC MSCI Brazil ETF
HSBC MSCI Emerging Markets ETF
HSBC MSCI Russia Capped ETF
HSBC MSCI China ETF
HSBC MSCI Europe ETF
HSBC MSCI Japan ETF
HSBC MSCI Pacific ex Japan ETF
HSBC MSCI USA ETF
HSBC MSCI World ETF
HSBC S&P 500 ETF
iShares
iShares Barclays Capital £ Index-Linked Gilts
iShares Barclays Capital Emerging Markets Local Govt Bond
iShares Barclays Capital Global Inflation-Linked Bond
iShares DJ Asia/Pacific Select Dividend 30
iShares Dow Jones Emerging Markets Select Dividend
iShares FTSE 100
iShares FTSE 250
iShares FTSE BRIC 50
iShares FTSE China 25
iShares FTSE EPRA/NAREIT Asia Property Yield Fund
iShares FTSE EPRA/NAREIT Developed Market Property
iShares FTSE EPRA/NAREIT UK Property Fund
iShares FTSE EPRA/NAREIT European Property Index Fund
iShares FTSE Gilts UK 0-5
iShares FTSE UK All Stocks Gilt
iShares FTSE UK Dividend Plus
iShares MSCI World Islamic
iShares Markit iBoxx $ Capped High Yield
iShares Markit iBoxx £ Corporate 1-5 Year
iShares Markit iBoxx £ Corporate Bond
iShares Markit iBoxx £ Corporate Bond ex-Financials
iShares MSCI AC Far East ex-Japan
iShares MSCI Brazil
iShares MSCI Emerging Markets
iShares MSCI Europe ex-UK
iShares MSCI Japan
iShares MSCI World
iShares S&P 500
iShares S&P Commodity Producers Gold
iShares Physical Gold ETC