Swiss ETF market is seeing strong growth

The Swiss ETF market is experiencing strong growth, with new investors and new issuers boosting the market.

At the end of the third quarter, ETF volumes on the Six Swiss Exchange had already beaten 2010's figures. Turnover stood at CHF80bn (€65.66bn) by the end of September, compared to CHF71bn (€58.26bn) in the whole of last year.

The growth is in part due to new investors coming into the market. "We have seen an increasing flow from both retail and professional investors," says Alain Picard, head of product management at the Six Swiss Exchange.

"We see a lot of people coming from online, discount brokers; we also see more and more smaller trades. It's difficult to look behind trades but we saw our average trading size coming down which is a clear indicator that there is more retail orientated trading coming up."

This has been in part due to increased investor education about ETFs but the big Swiss banks - UBS and Credit Suisse - have also been marketing ETFs to client advisers, explains Picard.

Added to that, private banks have come under pressure to offer ETFs to their clients.

At the same time, there have been more issuers coming into the Swiss market. State Street listed its first SPDR branded ETFs in the market this year.

There are also four more new issuers in the pipeline, says Picard. These are already established players which want to cross-list into the market and also small, domestic asset managers which want to enter the ETF market.