The asset management industry's leading trade body has given the go ahead for exchange traded funds (ETFs) to join its influential fund sector classifications.
From the first quarter of 2020, investors will be able to compare ETFs against the 3,500 funds in the Investment Association's (IA) existing 37 fund sectors.
The sectors divide funds into groups based factors such as the markets they invest in and asset class.
Two hundred ETFs – either UK domiciled, or EU Ucits with HMRC reporting fund status – are currently eligible to be included in the sectors.
IA director of investment and capital markets Galina Dimitrova said: ‘We want to ensure that the IA sectors reflect the full range of products the asset management industry has to offer savers around the world.
‘ETFs are a growing part of this market and their inclusion in the sectors will enable consumers to compare across a wider variety of products.’
The decision by the IA to bring ETFs under its classifications comes as a long-term boom in inflows has brought their total assets under management in Europe to near $1 trillion.
HANetf co-founder Hector McNeil said: 'Adding ETFs to broader investment sectors is an encouraging move from the IA that recognises how ETFs are becoming the product of choice for institutional and retail investors.
'We have long argued that ETFs are simply a "better technology" to deliver investment ideas and will benefit when fairly judged side-by-side with traditional fund products.'