Barclays Global Investors (BGI) expects its recently launched Brazilian exchange-traded funds (ETF) to have some US$1bn-2bn in assets under management in one year, BGI CEO for the region Daniel Gamba told BNamericas.
Earlier in December, BGI launched the first Brazilian iShares ETFs on BM&F Bovespa.
The ETFs - iShares Ibovespa Fundo de Índice, iShares BM&FBovespa Small Cap Fundo de Índice and iShares BM&FBovespa MidLarge Cap Fundo de Índice - are the first approved by the Comissão de Valores Mobiliários (CVM).
BGI will in a first stage target sophisticated institutional investors that use Bovespa for hedging purposes as well as asset managers that can use them for long positions.
The ETFs received a better-than-expected welcome in Brazil, trading some 50mn reais (US$20mn) in its first two days, Gamba said.
Gamba added BGI had been working on launching ETFs in Brazil for three years now as regulations restricted the development of these funds.
BGI launched iShares ETFs in Mexico in November 2007 and today boasts US$1.3bn in business volume. Around US$340mn of ETFs were sold in the IPO.
"We think Brazil could be more successful if you consider the market there is four or six times deeper than Mexico," Gamba said.
In Latin America, Barclays Global Investors currently manages 94 cross-listed and four locally listed iShares ETFs in Mexico and also offers more than 100 iShares ETFs to pension plans and mutual funds in Chile and Peru.
Barclays is the region's ETF market leader with some US$13bn in assets under management, with the bulk coming from operations in Chile and Mexico.
SANTIAGO OFFICE ON THE WAY
In Chile, Barclays has seen very strong interest in ETFs among the country's private pension fund managers, the AFPs.
This success led BGI to consider opening an office in Santiago, a project Gamba said it is well under way.
"We are moving fast and I think we'll make an announcement in the first quarter of 2009."
Today, BGI has regional offices in Mexico City and São Paulo.
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