ETF and ETP industry highlights end October 2008

Below and attached are some highlights from our ETF and ETP Industry Review report which we are currently writing. The full report will be published in a few weeks.

Current Trends: In the first ten months of 2008 we have seen investors move assets into ETFs providing exposure to fixed income and commodity indices while the assets in ETFs tracking equity indices especially Global (ex US) and Emerging Market indices have declined.

Stocks suffered their worst ever monthly losses in many markets in October.

The SandP 500 fell the most in a single month since the crash of 1987.

The Nikkei 225 fell 24% - the worst in its 58 year history.

Many investors are afraid to take action and are sitting on higher than average cash balances.

According to the SIX Swiss Exchange, ETF trading reached an all-time high with a turnover of CHF 7.6 billion (+95.42% versus the prior-month reading and +183.65% compared to October 2007) on the SIX Swiss Exchange, SWX Europe and Scoach Switzerland.

Investors who are expressing concerns over counterparty risk, transparency and liquidity when using structured products, swaps, certificates, and notes are showing a preference for ETFs where the structure is a fund, and often, more specifically for ETFs which invest exclusively in-specie in securities.

In Europe the net sales of ETFs in the first eight months of 2008 were USD 47.6 billion.

European domiciled mutual funds net sales were USD - 125.1 billion based on data from Lipper/Feri.

October saw the largest number of ETF managers close their ETFs, with Santander, Bear Stearns and FocusShares closing their ETF businesses.

Year to date there have been 53 ETF closures.

Global ETF and ETP Industry 2008: At the end of October 2008, there were 1,502 ETFs with 2,528 listings, assets of US$642.95 billion, managed by 85 managers on 43 exchanges around the world.

Worldwide YTD ETF AUM fell by 19.3%, which is less than the 39.75% fall in the MSCI World index in USD terms.

Exchanges with official ETF listings increased by two YTD to 43.

# ETFs increased by 28% with 381 new launches YTD.

Standard and Poors (SandP) ranks 1st with US$187.36 Bn in ETF AUM tied to their benchmarks, while MSCI ranks 2nd with US$122.93 Bn, followed by Russell in 3rd with US$49.50 Bn.

Year to date, the average daily trading volume in US dollar has increased by 125% to US$136.16 billion.

There are currently plans to launch 571 new ETFs.

Additionally, there were 269 other ETPs (Exchange Traded Products) with assets of US$46.21 Bn managed by 26 managers on 14 exchanges.

European ETF and ETP Industry 2008: At the end of October 2008 in Europe there were 29 managers of 587 ETFs with 1,455 listings and US$125.76 billion in assets officially listed on 20 exchanges.

During 2008 YTD, ETF AUM in Europe has fallen by 2.1% which is less than the 46.59% fall in the MSCI Europe index in USD terms.

In Europe, ETFs providing exposure to Fixed Income are the most popular with 27.3% of the assets followed closely by ETFs covering European Country indices with 18.6% of the assets.

During 2008 YTD, 172 new ETFs were launched in Europe.

April 11th marked the 8th anniversary of the first ETFs in Europe.

There are plans to launch 42 new ETFs in Europe.

Additionally, there were 123 other ETPs (Exchange Traded Products) with assets of US$5.69 Bn managed by 1 manager on 5 exchanges.

U.S.

ETF and ETP Industry 2008: At the end of October 2008 in the United States there were 18 managers of 663 ETFs, with assets of $454.38 USD billion officially listed on 4 exchanges.

At the end of October 2008, 105 new ETFs have been launched in the US.

During 2008 YTD, AUM in US listed ETFs fell 21.8% which is less than the 34.03% fall in the MSCI US index in USD terms.

January 29th marked the 15th anniversary of the SPDR in the US.

On April 11th 2008, the first Active equity ETFs which must disclose their portfolio holdings were listed.

There are plans to launch 470 new ETFs in the US.

Additionally, there were 135 other ETPs (Exchange Traded Products) with assets of US$39.87 Bn managed by 17 managers on 2 exchanges.

Upcoming Events: The future of UCITS global brand, Luxembourg, 13-Nov-08: www.mgi-direct.ch.

Wealth Management Forum (A Focus on ETFs), London, 21-Nov-08: http://www.londonstockexchange.com/en-gb/products/training/ETF%20Conference.

Nikkei ETF Event, Tokyo, Japan, 25-Nov-08: http://www.adnet.jp/nikkei/veritas/20081125.asp.

Fund Forum Middle East 2008, Bahrain, 01-Dec-08: http://www.icbi-events.com/fundsmiddleeast/.

4th Annual US Commodities Investment Conference, New York, 08-Dec-08.

For additional information or to sign up for our full reports, please send us an email with your full details to: ETFresearch@barclaysglobal.com.

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