The exchange-traded funds space has had its fair share of successful launches and flameouts this year.

Bill Gross' BOND fund has become the poster child of success, having gathered some $3 billion in assets in a little over seven months to become what some industry publications are calling the most successful actively managed exchange traded fund launch ever. BOND is the exchange-traded version of the PIMCO Total Return Fund, the world's largest mutual fund with about $278 billion in assets.

On the other side of the fence, shops such as Russell Investments and FocusShares shuttered large numbers of their ETFs this summer.

So what makes for a successful and unsuccessful fund launch?

Gary Gordon, president of Pacific Park Financial, a registered investment adviser, tries to supply the answer. Gordon, who writes commentary for financial publications such as Seeking Alpha and The Street and hosts the ETF Expert Show on the radio, says it boils down to a few basic principles.

According to Gordon, it starts with an idea or innovation. Then, it's up to the purveyor's level of "grit" and determination to make that idea stick in the marketplace via aggressive marketing. Lastly, but not least, it all boils down to luck, which Gordon says is a matter of being in the right place at the right time.

"Advisors and money managers are going to look at the emotional component and financial component of the ETF," he said, at the IMN Global Indexing and ETFs Conference in Phoenix last week.

"You want to have that fear and greed factor and understand the environment that you're in. So in 2006, what was everyone introducing at that time? Low vol ETFs? No. High-yield bonds? No. It was emerging market ETFs such as small-cap Brazil ETFs. Also frontier (funds) and ETFs investing in the Middle East and North Africa."

Fast forward to 2012. According to ETF Trends, the top-selling ETFs this year reflect investors moving toward taking on more risk and also for yield in a low-rate environment. That is to say investors poured $11.5 billion into Vanguard MSCI Emerging Markets (VWO) and $10.5 billion into the SPDR S&P 500 (SPY).

Investors are trusting that BlackRock's Larry Fink and Vanguard's Bill McNabb know a few things about fear, grit and greed.

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