European physical exchange-traded funds have grown at twice the rate of synthetic ETFs since 2011, as scrutiny over the risks associated with synthetic products weighed upon the market.

Physical ETFs have grown by 35% in assets under management to €171.3bn since the start of 2011, according to a report from Deutsche Bank published yesterday. This compared with an increase of 18% for synthetic products to €96bn. The number of physical ETFs also rose 18% from 444 to 524 across the period, compared with a 4.2% increase from 776 to 809 in the number of synthetic funds.