GRAPHIC-Retail investors "short" sterling via ETFs before Brexit vote

* Total assets in "short" sterling ETFs double

* Hits highest level since Scottish referendum

* Assets in Short/Long GBP ETF: http://tmsnrt.rs/1tfXkkw

By Atul Prakash

LONDON, June 10 (Reuters) - Retail investors betting on aweaker pound before Britain's vote on European Union membershiphave pumped money into exchange traded funds (ETFs) that allowthem to short the currency, echoing a trend seen before the 2014Scottish referendum two years ago.

Total assets held by such ETFs have doubled thisyear and have climbed to about $113 million, close to their peakof $123 million in 2014, as this chart shows: http://tmsnrt.rs/1tfXkkw

In contrast, "long" sterling positions are ataround $17.5 million, according to ETF Securities, which says ithas a 99 percent share in the European foreign exchange ETFmarket.

The threat of a possible British exit from the EU, orBrexit, has dominated the sterling market since late last year,driving a decline of more than 10 percent in the currency on atrade-weighted basis between mid-November and mid-April.

The latest betting odds on website Betfair show the impliedprobability of a British vote to stay in the European Union at74 percent, down from as high as 78 percent on Thursday.

Niche ETFs are popular among retail investors who otherwisefind it expensive to short currencies or access complex tradesthat often require derivatives and leverage.

"If you are a very sophisticated fund manager, you could buysuch a short sterling product in other ways, but in the retailspace, it's one of the simpler and cheaper ways to access thisproduct," said James Butterfill, head of research and investmentstrategy at ETF Securities.

ETF Securities' currency exchange traded products are basedon Morgan Stanley's foreign exchange indices, and use forwardcontracts and swaps to replicate the performance of theunderlying index.

(Editing and graphic by Vikram Subhedar; Additional editing byMark Potter)