He's been called the “Father of ETFs.” Lee Kranefuss built up the world's largest ETF platform, iShares, back in 2000 for Barclays Global Investors before it was sold to BlackRock (BLK) in 2009. By the end of that year global ETF assets exceeded a trillion dollars globally.
After taking some time off Kranefuss is back, this time focusing on Europe with Source ETFs, an European Exchange Traded Product provider. But things were a lot different when he started.
“The big idea was making more access available to more investors,” he notes about the creation of ETFs in the attached video. Before, getting exposure to a vast array of stocks would have cost a pretty penny (if not millions). Now, “taking it down to $10 and $100 chunks, all day long, for any brokerage account, any individual, or the advisors serving them could get the same thing.”
For Kranefuss, creating ETFs was really the best way to level the playing field. “It’s really democratizing a world of capital markets that the pros had, and you had go through their funds to get it, and make it possible for you or your advisor to do it for your own portfolio.”
To that end, Kranefuss’s current firm, Source, is looking to make access to Europe easier for U.S. investors. Source’s first investment product for the American market, the Source EURO STOXX 50 ETF, offers exposure to a major index for European equity markets. The EURO STOXX 50 Index is comprised of 50 of the largest companies domiciled in the Eurozone, and according to Source “is the primary hedging tool used by global trading desks.” This ETF is a collaboration between Source and index provider Stoxx.
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