How Can Active ETFs Gain Traction?
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Monday, May 07, 2012

How Can Active ETFs Gain Traction?

Actively managed ETFs haven't taken off to the same extent as some of their passively managed brethren. Murray Coleman of the Wall Street Journal reports on several methods mutual funds firms want to use to make active ETFs more appealing to traditional PMs by tweaking ETFs' transparency.

Eaton Vance-affiliate Navigate Fund Solutions [profile] is developing "exchange-traded managed funds," i.e. ETMFs. These ETMFs would still disclose holdings daily but wouldn't publicize changes until trades settle and would use "indicative NAVs" hourly inside of exact NAVs.

BlackRock has asked for SEC permission to launch active iShares [profile] with holdings perhaps disclosed only quarterly, and Guggenheim Investments [profile] wants to, the WSJ writes, "create a proxy portfolio designed to closely mimic an ETF's actual movements throughout the day even though the specific holdings could be different."

NYSE Euronext managing director Tony Baker, AdvisorShares [profile] CEO Noah Hamman, former Claymore Securities president and current consultant Christian Magoon, Strategic Insight executive vice president Avi Nachmany and Pimco [profile] ETF product management chief Don Suskind all weighed in for the WSJ piece.

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