HELPLINE: 
Why investors are flocking to ETFs
The situation. Exchange-Traded Funds (ETFs) are becoming a go-to choice for individual and institutional investors. Tax efficient and flexible, they exist for almost every asset class, from equities and bonds to real estate, and they’re also accessible from around €1,000.
The advantage. ETFs hit the radar as trust in active fund managers declined due to underperformance and high fees. Carrying lower management costs, they trade like equities, are ideal for passive investing and are supported by major institutions for liquidity, hedging and portfolio building.
How it works. ETFs are structured to track a benchmark, such as the S&P 500, global bonds, or specific themes like clean energy or artificial intelligence. Shares are bought and sold on stock exchanges with prices fluctuating in real time.
Why it matters. One of the fastest-growing segments in the asset management industry, they enable precise asset allocation, reduce costs and remove many of the frictions associated with actively managed funds.