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December 11, 2019 at 04:23 PM
The SEC has given final approval to four firms to launch actively managed ETFs that don’t disclose their holdings on a daily basis.
The firms are T. Rowe Price, Fidelity, Natixis and Blue Tractor. The first three would come to market with their own funds, though Fidelity is also applying to license its technology to other firms; Blue Tractor would license its strategy to asset managers, much like Precidian has done with its nontransparent ActiveShares ETF strategy.
(Related: SEC Approves More Nontransparent ETF Strategies)
American Century, one of the firms that licensed ActiveShares’ nontransparent ETF strategy, recently filed with the SEC to license an alternative structure for nontransparent domestic and international equity ETFs using a structure developed by the NYSE.
Its growth and value nontransparent ETFs using Precidian’s ActiveShares strategy are awaiting SEC approval of Cboe’s application to list those ETFs.
Gabelli Funds, which also licensed the ActiveShares strategy, recently received final approval from the SEC to trade those funds.
Unlike traditional ETFs, nontransparent or semitransparent ETFs, as they are variously called, do not disclosure their holdings daily, allowing active fund managers to keep others from knowing their so-called “secret sauce” and prevent front running or copying their holdings.
