What makes an ETF successful?
For the ETF issuer, survival is the primary measure of success since some ETF launches do
not gather enough assets and are shut down. Asset growth is the main measure of commercial
success for an asset manager since the vast majority of ETFs charge only management fees
and no performance fees.
For end investors, investment performance is the main metric of success. In many cases this
will be measured as positive returns, but in some cases benchmark-driven investors might
sometimes be happy to have lost less than their benchmark in a year like 2022 when most
equity and bond markets were down.
