LONDON (Reuters) - Assets under management of exchange traded funds (ETFs) will double to at least $5 trillion by 2020, consultant PwC said on Monday, as investors increase exposure to such products given their lower costs than traditional mutual funds.
"Institutional investors are widely expected to be the primary global growth driver with insurance companies, pension plans and hedge funds projected to be significant sources of demand for ETFs," the consultant said.
ETFs mimic the performance of a financial index.
The findings, based on a survey of 60 ETF sponsors, asset managers and service providers, also predicted that six out of every 10 ETF providers would increase profitability in 2015.
While Europe and the U.S. will dominate, the highest rates of growth are expected in less mature markets in Asia, Latin America, the Middle East and Africa, PwC said.
Reporting by Nishant Kumar; editing by Carolyn Cohn