In April, the Financial Stability Board, the Switzerland-based international standard-setting entity organised to develop common bank regulations, highlighted two potential risks stemming from the growth in the ETF market: the risk from synthetic ETFs, and the risk from securities lending.

Securities lending holds two potential weak spots: first, ETF providers lend out shares and then face a sudden redemption call and can't get hold of the shares. Second, ETFs themselves are lent out through short selling, leading to increased counterparty risk for ETF owners.