Self-Directed Investors Drive ETF Popularity

A study by Cogent Research confirmed that most affluent investors aren’t using advisers to purchase exchange-traded funds (ETFs).

Nearly two-thirds of affluent investors who own ETFs said they purchased the products with no help from an adviser, according to the research firm. Forty percent of those self-directed ETF owners said they plan to increase their use of these products, compared to just 26% of advised ETF owners.

Even investors with advisers feel comfortable purchasing ETFs without the assistance of their adviser. The study found that one in four advised investors that own ETFs bought the products on their own.

Those who purchase their own ETFs demonstrate more of an understanding of the marketplace. In fact, self-directed ETF owners are twice as likely as their advised counterparts to be aware of major ETF providers (38% on average for self-directed; 18% on average for advised).

“Given the high engagement level of self-directed investors with ETFs, it’s no wonder that providers are now focused on addressing the needs of this important audience,” said Christy White, Cogent Research co-founder and principal, in a release of the results.

The results are part of Cogent’s “2010 Investor Brandscape” report, which is based on a survey of 4,000 affluent investors.

More information about purchasing the research is available