Invesco’s Paglia On What’s Next

The new head of ETF business at Invesco talks about the latest trends in the ETF space.

Reviewed by: Cinthia Murphy
Edited by: Cinthia Murphy

Innovation in the ETF space is one of the things Anna Paglia, global head of ETFs and Indexed Strategies at Invesco, is focusing on right now.

Paglia, a 20-year ETF veteran whose decade-long tenure at Invesco led to her appointment as head of the ETF business at the firm earlier this year, sees ETFs as a technology, and one that through innovation can keep helping clients navigate markets and achieve goals in periods of uncertainty. It all comes down to solving client issues.

Speaking at the virtual ETFGI Global ETFs Insights Summit on Tuesday—a three-day event—Paglia shared in a brief chat with ETFGI’s Debbie Fuhr the story of joining Invesco while it was in the process of acquiring the PowerShares ETF business.

As she relayed it, it was a deal that amounted to a “combination of a very entrepreneurial company with the risk aversity of Invesco,” and one that would grow its ETF footprint from $16 billion in assets some 10 years ago to more than $250 billion today.

There are some 220 Invesco ETFs on the market today, including one of the few to have ever crossed the $100-billion-in-assets milestone, the Invesco QQQ Trust (QQQ)one of the most popular ETFs of 2020.

“Witnessing this growth has been a great privilege,” Paglia said. “I have loved the last 20 years. I’m even more excited about the next 20 years to see where innovation takes us.”

Her conversation with Fuhr touched on some of the hottest issues of the day. Here are some of her takeaways:

  • On the state of the industry: “The ETF industry is alive and well. But what we think doesn’t really matter. What matters is what clients think. Investors have a way of voting with their own money.”

“I usually think about the success of an initiative or lack thereof through this idea of follow the money trail,” she said. “You can’t argue that the industry is healthy and is alive.”

If you were to follow the money, you’d quickly see that the ETF industry has gone from under $100 billion in assets back in 2000, to just under $1 trillion by 2010, to north of $4.5 trillion today.

  • On how ETFs performed in March: “Prior to this pandemic, people would talk about liquidity of an ETF as liquidity of the underlying. We believe ETFs are helping the liquidity of their underlying constituents, and over the last few months, that was tested really hard. In my book, ETFs passed the test with flying colors.”

Through all the turmoil in markets, and extreme volatility, we have seen trading volumes for ETFs skyrocket, Paglia says.

“That’s an indication that investors are resorting to ETFs to gather liquidity in a period of market distress,” she explained. “We also saw fixed income ETFs trading at discount to NAV in March. But in an interesting turn of events, everyone realized that ETFs became the proxy for an asset class that doesn’t trade on an exchange, and one that doesn’t have price transparency. It proved the resilience of the ETF industry and the ETF wrapper as a technology as a proxy for underlying securities.”

  • On the Fed now using ETFs: Surprised? “Yes and no.”

The Fed has played a critical role in market liquidity before, but this year it expanded its usual playbook to include ETFs.

“That was new—it surprised me. On the other side, I’m not surprised, because we know ETFs are the perfect instrument to get liquidity,” she noted. “The Fed created liquidity, but they did it through a wrapper where unwinding those positions will be very easy. The Fed was brilliant.”

  • On nontransparent active ETFs: “We shouldn’t bring too much attention to words  nontransparent, semitransparent, active, passive.”

“It’s not about passive or active, an either/or conversation. That line is very blurred,” she said. “It’s about what investment tools you’re bringing to your clients. We have merged active and passive in so many ways over the years, so for us [at Invesco] it’s about how you combine these powerful tools to provide solutions to investors. Semitransparency is just an additional tool that allows us to offer strategies we didn’t before due to front-running concerns.”

Will it change the industry? “Maybe, maybe not,” she said. “We don’t expect to sit down with clients and talk about transparency or lack of transparency. The conversation is going to be about performance and the technology behind it.”

The virtual ETFGI Global ETFs Insight Summit, running from Tuesday through Thursday from 2:30 to 5:30 p.m. ET, will cover a wide range of topics from ETF trading and regulation, to asset allocation to trends in the ETF industry, including ESG investing. In addition to Paglia’s fireside chat, former head of State Street ETFs Jim Ross and Alex Matturri, retired CEO of S&P Dow Jones Indices, are among the keynote speakers in the agenda.

Contact Cinthia Murphy at [email protected]

Cinthia Murphy is head of digital experience, advocating for the user in all that does. She previously served as managing editor and writer for, specializing in ETF content and multimedia. Cinthia’s experience includes time at Dow Jones and former BridgeNews, covering commodity futures markets in Chicago and Brazil equities in Sao Paulo. She has a bachelor’s degree in journalism from the University of Missouri-Columbia.