What are the biggest changes likely to hit the Exchange Traded Fund market in the next five years? Consider the humble corn flake.

In the 1890s, John Kellogg developed corn flakes as part of the bland diet served at his Michigan sanitarium. The patients loved them. Dr. Kellogg’s businessman brother then added sugar to the flakes and brought them to the mass market. Before long, Kellogg’s Corn Flakes were an American breakfast staple.

Since then, the corn flake has been endlessly copied, reinvented and repackaged. Every major grocery chain and food distributer in the world has its own flake cereal or derivative thereof.

Today’s competitive challenge is to create unique flake products – such as gluten-free; with fruits, nuts, or honey; in serving-size packages; with pictures of Olympians on the boxes – anything to charge more than a commodity price.

In 1975, Vanguard Group’s John Bogle created an investment as unpretentious as the corn flake: the S&P 500 Index fund, which was a simple, low-cost way to get broad U.S. stock-market diversification for a low price. The first U.S. Exchange Traded Fund (ETF), arriving two decades later, was based on the same idea: It held an unmanaged basket of S&P 500 securities. The difference was that the basket could be purchased on a market exchange, thus affording intraday trading, market orders, leverage and hedging through puts, calls and shorts.

Since then, index funds and ETFs have gone the way of the corn flake: What exists today and will be created tomorrow looks little like its humble, healthy prototype. The consumer will be increasingly confused by all the flavors, and the packaging will change far more rapidly than the contents. Pricing will likely go up as manufacturers pursue ETF active management, derivatives and synthetics.

In my opinion, ETFs served consumers best in their original manifestation: As simple, good-for-you investment fare that works as a staple in just about everyone’s portfolio. Unfortunately, today’s ETF providers seem to be racing to the bottom in an effort to create new and esoteric ETF products that may dazzle, but don’t nourish, the average retail investor.