Offering exchange-traded funds in certain areas such as private equity might seem hard to do, "but it was hard to do SPY," said Susan Thompson, head of Americas distribution for SPDR ETFs at State Street Global Advisors, referring to the SPDR S&P 500 ETF Trust by its ticker symbol.
Ms. Thompson's comments came during a panel discussion Tuesday hosted by SSGA in connection with the 30th anniversary of the launch of SPY, the first U.S.-listed ETF. Hilary Corman, head of U.S. institutional for SPDR ETFs at SSGA, asked the panel whether innovation will remain important in the ETF market, or whether the industry's product set is complete, and it will just grow what it has.
"I think that there's more innovation to be had," Ms. Thompson said, adding that there are still areas where ETFs don't exist and where it would be hard to do them.
While SPY launched in 1993, "it came out of the '87 crash," she said of the fund, which has about $375 billion in assets under management.
"Hard stuff might be the right thing to do, but it might take some time," Ms. Thompson said.
Currently, "there is no real, good alternative private equity type of ETF and the knee-jerk reaction is it can't be done," she said, citing reasons for that reaction involving regulatory and market structure issues.
"But we said the same thing about SPY," Ms. Thompson said. "Heck, we said the same thing about high-yield bonds."
ETFs "can bring liquidity to otherwise illiquid places," she said.
