ETF Focus: An industry icon explains how Enron’s fall sparked the ETF explosion

In 2017, the appeal of exchange-traded funds seems so obvious that their rapid growth and increasingly dominant role on Wall Street appears almost inevitable.

But according to Lee Kranefuss, a central figure in the industry’s early days, investors only began to embrace ETFs after an event with no direct connection to funds: the 2001 collapse of one-time energy giant Enron Corp.

Kranefuss is the co-chairman at 55 Capital Partners, a firm that develops portfolios using ETFs. He was also a founder of iShares, the family of ETFs, currently operated by BlackRock Inc. BLK, +0.32% that has an industry market share of 36.9%.

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