Industry focus on fees will continue to drive smart-beta inflows

Expense ratio of 0.30% or below saw most flows

Analysts at AB Bernstein have written a report highlighting the majority of inflows into smart-beta since 2015 have been captured by strategies with lower total expense ratios.

In the report The only way is up? Smart-beta ETF trends over the past 6 months seen by Investment Week, the analysts found smart-beta ETFs with an expense ratio below 0.30% have captured more than 80% of the flows between 1 January 2015 and 1 August 2017. Furthermore, the analysts pointed to the significant cost advantage of smart-beta ETFs over actively managed mutual funds as a crucial "structural" driver of demand. Moody's: Passives will overtake active funds in US by 2024 Alla Harmsworth, head of European quantitative strategy at Bernstein Investment Research, said: "As long as...