There are almost 400 smart-beta funds in the U.S. right now, and they account for $400 billion, or 20 percent of all assets, in domestic ETFs, according to Bloomberg Intelligence. That’s up from zero in May 2000, when the first prototypes—one iShares ETF aimed at growth and another at value—marched out of the lab and onto exchanges. Like any Wall Street bonanza, this one has drawn imitators, innovators, and possibly a few hucksters, according to the U.S. Financial Industry Regulatory Authority, which included smart beta on a list of eight product categories that it plans to scrutinize for sales violations this year. “For individual investors, products tracking these indices may be complex or unfamiliar,’’ Finra said in a Jan. 6 letter. “It remains an open question how the indices and products tracking them will behave in different market environments.’’

http://www.bloomberg.com/news/articles/2015-03-16/smart-beta-etfs-attract-billions-with-critics-blaming-dumb-money