Changing costs and attitudes to ETFs sees investors 'vote with their feet'

A new era of cost-consciousness has resulted in a different type of investor - one whose behaviour reflects an understanding of fund costs, says Neil Cowell, head of UK retail sales at Vanguard Asset Management.

Increased regulatory scrutiny on fees has changed a lot of things in the asset management industry, but has it altered investor behaviour? Improved transparency has certainly made investors more aware of the importance of costs in the investment decision-making process. This becomes clear when net cashflows are examined over the past five years. The findings demonstrate a clear trend towards lower cost funds, revealing investors are increasingly appreciating the impact of costs on their returns. Fund trends Within equity funds (actively managed, passively managed and ETFs), over t...