In Exchange-Traded Funds and the New Dynamics of Investing, Ananth Madhavan examines the quiet transformation of asset management through the rise of passive or index investing. A closely-related phenomenon is the rise of exchange-traded funds (ETFs). An ETF is an investment vehicle that trades intraday and seeks to replicate the performance of a specific index. ETFs have grown substantially in size, diversity, and market significance in recent years. These trends have generated considerable interest, especially from retail and institutional investors and increasingly from academics, regulators and the press. ETFs have the power to be a disruptive innovation to today's asset management industry because many traditional active managers and hedge funds deliver a significant fraction of their active returns via static exposures to factors like value. Indeed, for the first time ever, assets in global ETFs exceeded $3 trillion in 2015, passing the amount in hedge funds.

Ananth Madhavan is Managing Director and Global Head of Research for iShares, the world's largest provider of exchange-traded funds. Previous positions include the Global Head of Trading Research and Transitions at Barclays Global Investors, and Head of Research at ITG Inc., an electronic brokerage firm. Dr. Madhavan has also had an extensive career as a professor at the University of Southern California and the Wharton School of the University of Pennsylvania.

1. The Current Landscape
2. Structure and Mechanics
3. Price Dynamics and Arbitrage
4. Valuation
5. Performance and Benchmark Tracking
6. Liquidity and Transaction Costs
7. Uses of ETFs
8. Fixed Income
9. Commodities
10. Foreign Currency
11. Investing in Volatility
12. Alternatives and Multi-Asset Strategies
13. Active Strategies
14. Smart Beta and Factor Investing
15. Flows
16. Leveraged and Inverse Products
17. Systemic Risk
18. Public Policy Issues
19. Future Opportunities