The Financial Stability Board last week published a report on exchange traded funds that warned that ETFs could undermine markets by claiming to offer liquidity to investors secured on synthetic structures. Its warning was followed up by the IMF and the Bank of International Settlements, which are also concerned of the systemic risks posed by over-enthusiastic securitisation.

Here, Deborah Fuhr, BlackRock's top exchange traded funds analyst, provides her response to the FSB report.