Quantcast
The MFWire
Manage Email Alerts | Sponsorships | About MFWire | Who We Are

Subscribe to MFWire.com's News Alerts [click]

Rating:Shouldn't We Stop Calling It That? Not Rated 0.0 Email Routing List Email & Route  Print Print
Thursday, April 18, 2019

Shouldn't We Stop Calling It That?

Reported by Neil Anderson, Managing Editor

If fundsters aren't careful, they could be setting themselves up for some branding confusion ... and not the good kind.

Last week the SEC granted conditional approval to a new kind of ETF, Precidian Investments' ActiveShares. As the name suggests, the new structure (which has been awaiting approval for nearly five years) is meant to be more friendly to active management, as it removes the need for such an active ETF to reveal its portfolio holdings daily. And thus was the "non-transparent" moniker born.

Publications of various stripes — including Bloomberg, ETF Trends, the National Law Review, and the Wall Street Journal — ran with variations on that label, non-transparent ETFs. So did BBH and even Precidian itself. Too bad.

From where MFWire sits, "non-transparent ETFs" is a label that is, at best, innocently misleading (because it belies the fact that, like regular mutual funds, Precidian's ActiveShares will still have to regularly reveal their portfolio holdings), and at worst, downright scary. How many investors will get visions of the next Bernie Madoff making their money disappear thanks to a "non-transparent" product?

Transparency is generally en vogue right now, and not just in financial services. Labeling an industry innovation as "non-transparent" might sound like the industry's putting a big "warning, these funds might screw you over!" label on the new products. Investors could be forgiven for not realizing that all the standard mutual fund protections will still apply here.

The ActiveShares name (and the name of a quasi-competitor, NextShares) does avoid running afoul of this problem. But it seems high time the industry comes up with a more investor-friendly description for funds that use structures like this. 

Stay ahead of the news ... Sign up for our email alerts now
CLICK HERE

0.0
 Do You Recommend This Story?



GO TO: MFWire
Return to Top
 News Archives
2022: Q2Q1
2021: Q4Q3Q2Q1
2020: Q4Q3Q2Q1
2019: Q4Q3Q2Q1
2018: Q4Q3Q2Q1
2017: Q4Q3Q2Q1
2016: Q4Q3Q2Q1
2015: Q4Q3Q2Q1
2014: Q4Q3Q2Q1
2013: Q4Q3Q2Q1
2012: Q4Q3Q2Q1
2011: Q4Q3Q2Q1
2010: Q4Q3Q2Q1
2009: Q4Q3Q2Q1
2008: Q4Q3Q2Q1
2007: Q4Q3Q2Q1
2006: Q4Q3Q2Q1
2005: Q4Q3Q2Q1
2004: Q4Q3Q2Q1
2003: Q4Q3Q2Q1
2002: Q4Q3Q2Q1
 Subscribe via RSS:
Raw XML
Add to My Yahoo!
follow us in feedly


  1. 2022 ICI Leadership Summit, May 25-26
  2. ALFI Roadshow to New York, May 25
  3. 2022 IDC Fund Directors Workshop, May 26
  4. Irish Funds Annual Global Funds Conference 2022, May 30-31
  5. WealthManagement Edge, May 31 - June 3
  6. MFDF 2022 Fund Governance and Regulatory Insights Conference, Jun 8-9
  7. 28th annual Expect Miracles East Coast Classic, June 9
  8. 2022 Sohn Investment Conference, June 9
  9. IDC webinar - Cybersecurity for Fund Boards: The Current Landscape, June 9
  10. MMI webinar - Driving Business Value with Artificial Intelligence & Data, June 15
  11. MFDF webinar - Key Takeaways From Morningstar's 2021 Annual Fund Fee Study, June 16
  12. MFDF Director Discussion Series - Open Forum (Chicago), June 21
  13. 2022 MMI Emerging Asset Managers Forum, June 23
  14. MFDF In Focus: Capitol Hill, A Conversation with Congressman Bryan Steil, June 28
  15. Financial Planning INVEST, Jun 28-29
  16. MFDF webinar - Differentiating Mutual-Fund-to-ETF Conversions, July 19
  17. MFDF Director Discussion Series - Open Forum (New York), July 20
  18. 2022 MMI Distribution Leadership Forum, Jul 20-21
  19. MFDF webinar - Fund Boards' Oversight of Investment Performance, July 28
  20. MFDF webinar - Performance, Perception and Manager Selection, September 14
  21. 2022 ICI Tax and Accounting Conference, Sep 18-21
  22. 5th annual Expect Miracles Atlantic Coast Classic, October 3
  23. Nicsa Fearless Leadership Symposium, Oct 6-7
  24. 2022 MMI Annual Conference, Oct 19-21
  25. 2022 IDC Fund Directors Conference, Oct 24-26
  26. 18th annual Expect Miracles Wine & Spirits Event, October 27




©All rights reserved to InvestmentWires, Inc. 1997-2022
14 Wall Street | 20th Floor | New York, NY 10005 | P: 212-331-8968 | F: 212-331-8998
Privacy Policy :: Terms of Use