The Development and Future of European Active Exchange-Traded Funds

Exchange-traded Funds (ETFs) are raising interests in the financial Markets. Passive ETFs in particular are raising the attention of the markets. This thesis will study the impact of the new regulation MIFID II/ MIFIR on ETFs. The focus will be on how the regulation impact active and passive ETFs and how it influences their development. To give a better view, the paper will compare the European market to the US market which happens to be the biggest ETFs market globally. The markets analysis will focus on markets sizes, market flows and volumes since 2008 to give an appreciation of the market’s evolution and on the attractiveness of ETFs in markets. The focus on MIFID II/MIFIR will be on dispositions on transparency and inducements as they have the biggest impact on ETFs and particularly on active ETFs. This paper will not cover other type of ETFs than those mentioned.