iShares [profile] backs the European Securities and Markets Association (Esma) on its encouragement that ETF providers should increase transparency in their products, reports the FT Adviser.

Esma has called for the firms to clearly label ETFs that comply with Ucits retail products rules. This means that the name of the funds must include Ucits ETF.

"These guidelines represent a positive step towards ensuring investors better understand the risks and attributes wiht exchange-traded products," said Joe Linhares, iShares head for Europe, the Middle East and Africa.

Esma also wants the firms to tell investors whether the products are involved in securities lending. Products that track Ucits fund should also ensure that the benchmark "respect strict criteria regarding, inter alia, the rebalancing frequency and their diversification."

Esma chair Steven Maijoor said the measures that they are suggesting will increase the level and the quality" of the information for investors.  

Edited by: HFD


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