European regulators have been urged to follow the lead of their US counterparts by examining ways to loosen the limits on the ability of fund managers to invest in exchange traded funds.

ETFs are increasingly being used by fund managers as a cheap, liquid method of gaining exposure to an asset class. Barclays Global Investors, the largest ETF issuer, estimates that 30 per cent of investment into its ETFs now comes from professional, rather than retail, investors.