Exchange Traded Products: Taxonomy, Risk and Mitigations

The first comprehensive risk taxonomy for Exchange Traded Products (ETPs) — ETFs, ETNs, and ETCs — classifying instruments across six axes: market risk, counterparty exposure, liquidity, structural complexity, regulatory arbitrage, and systemic contagion. For each risk class, observable early-warning indicators and targeted mitigation frameworks are proposed, with direct relevance for regulators confronting the systemic implications of passive investing at scale.