Advice on ESMA’s public consultation on UCITS Exchange-tradedfunds in the European Union

We generally agree with the concerns raised by ESMA relating to the increased complexity of ETFs, that raise significant issues both with respect to investor protection and systemic risk. ETFs are a low cost and straightforward investment proposition for investors, and as such, ESMA should investigate how to make indexed ETFs more appealing to retail investors. In respect to the prevention and mitigation of the risks that may arise from ETFswe believe that, in addition to disclosure requirements, regulators should adopt a more interventionist approach. We also believe it necessary to avoid any type of regulatory arbitrage, by subjecting all UCITS products and exchange-traded products to similar rules.

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