Key points:
- ETF data infrastructure is the practical constraint on how fast any issuer can launch and scale an ETF range
- The market is fragmenting and consolidating at once; hundreds of issuers, many launching onto shared platforms for scale from day one
- Much of the industry’s data complexity is self-inflicted taxonomy, and all of it can be standardised
- ETFs are now a global asset class, traded and hedged across regions rather than within one
Introducing Bernie Thurston (Ultumus) on ETF operations
Daniel Gonzalez Fuster: Thank you for joining our sixth episode of “ETFs Unwrapped”, a guide for asset manager Chief Operating Officers and operational leaders looking at launching ETFs in Europe. I am very happy to be joined today by Bernie Thurston, CEO and Founder of Ultumus, the leading provider of ETF and index data, calculation and workflow solutions.
Hi, Bernie, welcome to our podcast. Bernie, you are one of the most active, respected, and forward-looking voices in the European ETF industry. First of all, could you share with us your journey in the ETF industry?
Bernie Thurston: Certainly, my journey into the ETF industry has not exactly been a smooth or direct one in any way, shape or form. I was an engineer by trade, I was initially working on designing interactive television systems, and I moved into finance almost by accident. I discovered the fact that the distinction between a technology guy and a trader is becoming less and less defined these days, and nowhere do I think this is more explicit than within the market-making industry.
When I work around some of the market makers, the trading floors are full of ex-engineers, quants, mathematicians, so on and so forth. I almost feel quite at home. I then was in finance and again, my movement into the ETF industry was even more accidental. I was providing index data to a large investment bank, and they were moving into the ETF space. Predominantly, they were focusing on synthetic products; the connection between the index data and the ETF was more and more pronounced. They turned around to me and asked me: “You’re supplying our index data, could you help us with the Portfolio Composition File (PCF) side?”. And they were explaining to me what an ETF was, how it was constructed, and all the workflow associated with it.
I wandered out of that meeting, with my sales guy at that point in time, he turned around to me and went: “Do you actually understand what an ETF is? Because you sounded convinced during that meeting”, and I went, “No, I don’t have a clue. However, I’ve got another week or so, we have to go back and present them.” During that period, I actually learned what an ETF was from front-to-back, or my interpretation of that back in 2003. And I found it fascinating. That was effectively my whole entry into the ETF space.
Fortunately, my next presentation went very well. I was completely convinced in terms of the idea behind ETFs, and it amazed me. I thought ETFs were going to be the next big thing, by 2005, 2010, 2015, I was always convinced in terms of how these things should fly.
Now we seem to be getting there. But at that point in time, I was there and fortunately, I managed to create a career out of ETFs, and in 2016, I founded Ultumus with the sole aim of effectively providing solutions to the ETF industry. It amazed me. From 2003 to 2016, nobody had actually treated ETFs as their own standalone asset class. And that’s the whole ethos behind Ultumus. We look at this as something unique, something that actually needs its own focus. And that’s really where we come from. We’re not trying to shoehorn them into indices, we’re not trying to shoehorn them into mutual funds. These are their own financial asset classes, and that’s really where we are focused.
Trends in the European ETF market
Daniel: It’s great to have an engineer with us. As we can see, in your current role, you have a privileged view across dozens of issuers, thousands of products daily. I guess this provides a very practical and useful perspective for operational leaders navigating ETF growth at scale. Can you please share with us the main trends and challenges in this market at the moment?
Bernie: You said dozens of issuers. It’s hundreds of issuers. This is one of the major trends that we are seeing. The AuM[1] growth across this industry is phenomenal. I am not going to quote numbers because effectively every time I quote a number the next day it’s historical at that point in time. It has already been superseded. And again, the other area in terms of the number of ETFs. We’ve all seen the news articles. There are now more ETFs in the US market than there are underlying equity securities. These trends are absolute. The ETF industry is going great guns.
However, take a more European focus. There are two main trends that we believe are coming to the fore. These are effectively active ETFs and asset managers launching ETF ranges. These are both very much aligned. The asset managers are launching more and more active-based products in one of two ways. They normally are coming from a mutual fund background. They’ve got the opportunity of converting, or launching an ETF share class associated with their mutual fund. Either that or we’re beginning to see effectively very niche strategic, active strategies that again coming out the door. And both of these are very interesting. These are being driven because the asset managers are seeing the retail industry is requiring more and more specialised products.
ETFs are the way that people have seen that these can be delivered in a comprehensive and easily consumable way. That is the most important part. These are things that are now becoming more and more accepted across the various platforms, scalable. These are now being made accessible by the retail market on their phones. This is really where ETFs are coming to the fore.
The other trend that we are also seeing is a slight oxymoron in itself. The fact that we are seeing consolidation and fragmentation at the same time. The fragmentation is driven by the fact that as these ETF issuers are coming to market, we are seeing more and more issuers, products. However, the consolidation is coming about because some of these ETF issuers are choosing to launch on platforms such as BNP Paribas’ Securities Services, where they utilise the size and scale. Now we are seeing those ETF issuers coming on in a standardised structure with a standardised platform, which allows them to get the distribution and scale straight out of the gate.
We are seeing consolidation and fragmentation at the same time.
Standardising data to unlock ETF growth in Europe
Daniel: Definitely, this confirms what we see on ETFs, this increase of size and also this huge fragmentation that the market is facing.
Your point about active and niche strategies that are appearing in the market definitely increase the level of complexity and sophistication that is being faced by ETF issuers. And I think in the market, there is also an increasing interest about data being part of the main challenges faced by ETF actors when they launch new products. Could you please share more details on this particular issue?
Bernie: Certainly, it is very interesting. You mentioned complexity. Sometimes the ETF industry has a more fundamental problem than the sheer complexity. And I’m not going to go into our multi-asset class products that are hedged at the same time.
Just in terms of the basic taxonomy associated with the ETF industry. We have a great propensity within this industry for using three-letters acronyms. So, our individual product: ETF. We also have NAV[2], AUM, OCF[3], TER[4]. Anything that we can put a three-letters acronym against we do. Unfortunately, we don’t always do it in the same structure, against the same data point each time. This is one of the fragmentations that we see within this industry. Currently I’ve got three different NAVs within our feed: unofficial NAV, official NAV, real-time NAV.
Even with real-time NAV, we can’t even agree on the acronym associated with that. We have got I-NaV[5], we’ve got IOPV[6], we effectively fragment our own data. And obviously for asset managers coming into this space, being able to come from the mutual fund space to suddenly a tradable instrument which has got all these various acronyms against them, we introduce a level of complexity that isn’t required. All of these data points can be standardised.
That’s really the major point that we are now beginning to see across the industry. We begin to see more completeness of data. We are beginning to see standardisation and agreement in terms of what these terms mean. The various providers are now launching individual baskets. So, we are getting effectively a holding basket that ties back to NAV.
We are getting a pricing basket that actually is aligned with where the I-NAV is trading. We’re getting a settlement basket that is aligned with the creation / redemption, with all the data points associated with this. This is now becoming a much more holistic data set that we are seeing within the market.
Again, we’re seeing changes on a regular basis in terms of one of the large ETF issuers that used to produce ETFs share classes on mutual funds. They have never produced pricing data for the last 20-, 30-odd years. We are now beginning to see these baskets come out with this completeness of data, so people can be able to understand and trade these products.
Infrastructure solutions helping European asset managers scale ETF operations
Daniel: You have been talking about data and how data can play such a vital role in running an ETF business. And looking at your journey in the ETF industry, how do you think the ETF infrastructure can help to address these data challenges that you were mentioning?
Bernie: You hit the nail on the head there. The infrastructure that we are now beginning to see deployed addresses both the complexity and the data challenges in its entirety.
The number of market makers and Authorised Participants (APs) has not increased at the same scale as the ETF products available within the market. So for them to be able to consume, handle and price these products on a day-by-day basis – as we have just alluded to more and more being launched daily – they need to be able to see some standardisation associated with them.
They need to be able to have some straight-through processes put in place such that they can consume, price and trade these products. That is really what we are seeing now, these consolidations come to mind. This seems to be more and more of a movement towards, effectively, a standardised structure. We are beginning to see these OMS[7] systems connected by FIX and API such that they can do the creation / redemption on a day-by-day basis without any of the, let’s face it, faxes that used to be flying around.
We are now beginning to see all of this electronification, both from the consumption to the creation / redemption from front-to-back all the way through.
ETF globalisation
Daniel: So what would be your vision for the future of the ETF industry?
Bernie: A very interesting question. The vision for the ETF industry is the globalisation associated with it. We are beginning to see this already. Previously, we always used to look at America, Europe and Asia. People were looking at effectively the trades as they were completely segmented.
That is now beginning to break down. No one trades the S&P 500 in one particular region. We hedge across the various regions. Everyone has got their own various products associated with it. This is really where we are now beginning to see it. The ETF industry is not a specific exchange, a specific region.
This is a global industry with global products these days.
Daniel: Thanks again for sharing this engineer view, your insights and expertise. I think it was very interesting to hear how data and its related infrastructure can have such an important role in the future of ETFs in Europe. It complements very well what we have been already discussing in the previous chapters of this series.
So, thanks to you, Bernie, and thanks again also to all our listeners. I hope you have enjoyed this sixth episode of ETFs Unwrapped as much as I did.
Bernie: Daniel, thank you very much, I enjoyed being here.
For information purposes only, not investment advice. Views expressed are the speakers’ own. © 2026 Ultumus Ltd.. All rights reserved.
[1] Asset Under Management
[2] Net Asset Value
[3] Ongoing Charges Figure
[4] Total Expense Ratio
[5] Indicative Net Asset Value
[6] Indicative Optimized Portfolio Value
[7] Order Management System
