Český finanční a účetní časopis 2023(1):35-48 | DOI: 10.18267/j.cfuc.581

30 years of exchange traded funds: The boom and the risks of market and regulatory failure

Petr Musílek
Vysoká škola ekonomická v Praze, Fakulta financí a účetnictví, katedra bankovnictví a pojišťovnictví, Praha

The discussion paper focuses on the prerequisites for the creation, development and consequences of exchange traded funds. The article first analyzes the defining characteristics of the effective behavior of stock markets as an elementary prerequisite for the investment demand for passive portfolio management. Subsequently, attention is paid to the nature of exchange traded funds and their rapid development in recent decades. Individual types of exchange traded funds are also analyzed. In the final part of the paper, some risks of the rapid development of this financial innovation, which significantly changes the focus of investment management, both individual and institutional, are discussed.

Keywords: Efficient Market; Indexed Investing; Passive Investing; Exchange Traded Fund.
JEL classification: G23, G24

Accepted: October 13, 2023; Published: December 30, 2023  Show citation

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Musílek, P. (2023). 30 years of exchange traded funds: The boom and the risks of market and regulatory failure. Czech Financial and Accounting Journal, 2023(1), 35-48. doi: 10.18267/j.cfuc.581
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