The Wall Street Journal
's Karen Amato picks up
on BlackRock's [see profile]
proposal last month to rename the leveraged and inverse exchange-traded mutual funds.
BlackRock, whose iShares [see profile]
unit is the biggest ETF player, wants to rename
those products exchange-traded instruments. If the firm would have its way, the ETF tag would be limited to funds that "can be appropriate for a long-term
Jennifer Gracio, who runs iShares' global business development, says that
if investors have a bad experience with leveraged funds, "there is potentially a downside not just for our company but for the entire financial-services industry."
In BlackRock's own lineup, 228 of its 232 iShares would still be classified
as ETFs. The funds that invest mainly in derivatives or in precious metals would be called ETIs or exchange-traded commodities.
CEO Michael Sapir
called BlackRock's proposal "just plain arbitrary and unworkable." ETFTrends
editor Tom Lydon, in online comments, says the proposal is tantamount to "telling Ferrari [its cars] couldn't be called automobiles because they can exceed 150 mph."
Armie Margaret Lee
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