Last year, it seemed as though a new ETF was coming to market every other minute. But the heady days of 2007 aren't spilling over to 2008. In Saturday's
Wall Street Journal
, Shefali Anand
notes that there are fewer ETF launches these days compared to last year. The market turmoil has made it more difficult for firms to pitch narrowly focused ETFs to investors that have become more risk averse. Citing numbers from Morningstar
, Anand wrote that the number of ETFs entering the market dropped 70 percent to 27 in the first quarter versus 94 in the first three months of last year. "The appetite for new products isn't what it used to be," Dan Dolan
, a product manager at the Select Sector SPDRs, told Anand. Another factor behind the drop in the number of new ETFs is capital shortage.
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