• As ETPs consolidate their presence as listed vehicles for diversified exposures. Global volatility is driving their adoption among asset managers and institutional investors.
• More agile and efficient structures explain the growing use of ETPs and the ETN subgroup.
• FlexFunds offers securitization solutions to issue ETPs that facilitate the international distribution of fund portfolios on private banking platforms.

ETPs have gained prominence in global markets as increasingly popular vehicles for accessing a wide range of financial exposures, in a context of growing demand for more flexible and specialized listed structures.

Asset managers are looking to diversify their exposure amid high uncertainty driven by the trade war, along with the global weakness of the dollar and the rate differentials in emerging markets fueling risk appetite. 

Amid the search for portfolio diversification, usage trends point not only to different geographies but also to gaining exposure across different asset classes. 

Managers are focused on integrating a variety of assets such as equities, bonds, commodities, or indices that allow them to hedge against adversity. 

ETPs facilitate efficient access to different geographies and asset classes. They enable more flexible management of risk and portfolios.

In this context, ETPs help adjust risk exposure, take advantage of rate differentials, and build hedges against adverse scenarios.

These instruments allow managers and investors to access different geographies and asset classes quickly, in a liquid and listed manner, without needing to operate directly in each market. 

In this context, FlexFunds notes that the growing adoption of ETPs and ETNs also reflects the pursuit of more efficient structures for packaging and distributing investment strategies in global markets. 

Specialized platforms operating under securitization schemes have gained relevance by enabling the launch of listed vehicles in shorter timeframes, with lower operating costs and greater flexibility in portfolio composition, including the ability to combine liquid and illiquid assets.

This type of solution also facilitates access to international custody and trading networks, expanding the reach of managers, advisors, and financial institutions beyond the limitations of traditional vehicles.

The ETP group

Exchange-traded products (ETPs) encompass a range of financial instruments that seek to replicate the performance of a specific basket of assets.  

This type of instrument can provide exposure to a specific stock index, currencies, or commodities, aiming to replicate their performance.

ETPs group together different types of investments and are traded on stock exchanges, just like equities. 

Within the broad spectrum of ETPs, different categories can be distinguished, such as exchange-traded funds (ETFs), exchange-traded commodities (ETCs), and exchange-traded notes (ETNs).

ETNs, in particular, “are issued by banks and generally depend on the credit value of the issuing bank,” according to the financial institution BBVA. 

ETPs and ETNs have become key tools for navigating volatile markets. Volatility has accelerated the use of listed products as a means of diversification.

Characteristics of ETNs

ETPs have expanded strongly in global markets as listed vehicles that facilitate access to multiple assets and strategies. 

Within this group, ETNs have gained ground in more specific and complex exposures, driven by demand for flexibility and diversification in an environment of greater financial sophistication.

To give an example, ETFs acquire the assets of the index they track, granting indirect ownership of those securities within investment portfolios.

In contrast, ETNs are debt securities and operate similarly to bonds, providing financing to their issuers. 

Essentially, they function as a payment promise from the issuer (typically a bank), which commits to delivering the index’s return.

Through an ETN, one acquires the debt of the financial institution, but not ownership of the underlying asset it seeks to replicate. 

At the end of the cycle, ETNs provide a single payment that stems from the difference between the purchase price and the sale price of the underlying asset, net of fees, according to a Business Insider article. 

The main benefit of ETN is that they can provide access to uncommon assets such as currencies or newer markets such as emerging economies.

In summary, ETNs also allow the replication of an index and the capture of its performance at maturity, without the need to acquire the underlying assets, with direct trading on stock exchanges.

The main risks center on the issuer’s solvency, as well as the performance of the index they seek to replicate, as explained by Investopedia. 

IG explains in a blog post that, “because ETNs are not backed by any collateral, you could lose some or all of your capital should the issuer become unable to honour their debt to you”. 

Market growth

Assets invested in ETF, considered the most popular exchange-traded product, reached a record $19.85 trillion at the end of December worldwide, per a report by research and consulting firm ETFGI. 

This surpassed the previous record of $19.44 trillion from November 2025.

“The top 10 ETPs by net new assets collectively gathered $3.18 Bn over December,” according to ETFGI. 

In a challenging context, investors are also reconfiguring their exposure through exchange-traded funds.

Managers seek liquidity, flexibility, and global access in a single vehicle. In uncertain scenarios, structure matters as much as the asset.

Investors have reinforced their exposure to emerging markets through ETFs, which have recorded 15 consecutive weeks of net inflows totaling $42.8 billion, according to Bloomberg. 

In the week ending January 30 alone, emerging market ETFs listed in the United States attracted $6.5 billion. This brings year-to-date cumulative flows to $24.9 billion. 

Within the exchange-traded products market, FlexFunds has positioned itself as an ETP-ETN provider that enables access, through listed instruments, to different strategies and financial exposures.

FlexFunds simplifies the process of creating and issuing investment vehicles by converting any type of assets, liquid and illiquid, into bankable assets.

This approach responds to the growing global demand for more flexible, liquid, and specialized vehicles. This trend is likely to continue gaining momentum in an environment of greater volatility, where investors seek to diversify risks and optimize capital allocation. 

For more information, feel free to contact our team of experts. 

Sources:

• https://www.bbva.com/es/trading-etps-aprende-bbva-trader/
• https://www.businessinsider.com/personal-finance/investing/what-is-an-etn
• https://www.investopedia.com/terms/e/etn.asp
• https://www.ig.com/en-ch/trading-strategies/what-is-an-etp-and-how-can-you-trade-or-invest–230126
• https://etfgi.com/news/press-releases/2026/01/etfgi-reports-assets-global-etf-industry-hit-record-us1985-trillion
• https://www.bloomberg.com/news/articles/2026-02-02/emerging-market-etfs-rise-for-15th-week-in-42-8-bln-streak