Why is Goldman Sachs jumping into ETFs?

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Goldman Sachs (GS) is not the Goldman Sachs of the exchange traded funds industry. That would be Barclays, which was bought by BlackRock. So some are scratching their heads as to why the real Goldman Sachs would want to get into the business. There's no doubt that ETFs are still hot. Assets grew 64 percent through the end of November, notes TheStreet.com, and lots of premier banks are moving in.

PIMCO recently launched a bond ETF. Goldman Sachs' first ETF will passively follow index tracking companies in Brazil, India, China and South Korea. Other Goldman Sachs ETFs are coming. It's tempting to say that Goldman Sachs can easily make these products a hit. But that may not necessarily be the case. The brand matters less in this niche. It will be interesting to see how cheap the firm will make the new products. And it will be interesting to see if it ever starts offering actively managed ETFs, where its brand could be more of a factor. 

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