The FSC supports simplifying ETF naming conventions to enhance consumer understanding.
Different ETFs have different types of risks, and the FSC has been working with members to provide a sensible proposal in response to ASIC’s welcome consultation on Exchange Traded Product naming conventions and changes to Info Sheet 230. Key recommendations in the FSC’s submission include:
- Adopting a single category of naming conventions identifying whether a fund is an ETF, Active ETF or a Complex ETF;
- Ensuring the three naming conventions are mandatory and consistently applied across the industry and exchanges; and
- Making some important changes to the “Complex” definition proposed by ASIC, so that it can better distinguish between products that have different risk profiles, unique or complex structures.
There is great opportunity assist consumer understanding by simplifying ETF naming conventions in a meaningful way.
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