folks in the ETF industry believe everyone will soon be in the ETF industry

David_Snowball

Not that they have any institutional blindness on the matter. ETF Trends argues that the major fund firms are lobbying hard for semi-transparent or non-transparent ETFs. Clearance for those funds plus evidence that major retirement plan providers want ETFs (why? why, why, why? Low cost index funds, yes. But why a product whose strength is intra-day trading in a vehicle with a decades-long horizon?) would unleash, they say, a flood of new products.

David

Old_Joe

ETF Trends argues that the major fund firms are lobbying hard for semi-transparent or non-transparent ETFs.

“For us the issue remains transparency,” American Funds spokesman Chuck Freadhoff said in the article.

What exactly is being said here? Does American Funds see a problem because (in their opinion, at least)...

1) ETF's are too transparent? or

2) because they are not transparent?

OJ

David_Snowball

They're too transparent. Big firms build and dismantle positions over a period of days and they can't afford to have hedge funds forever front-running them by noticing that an active ETF made, say, the first of ten purchases of Costco. So they want to be able to reveal only after they've completed their moves. That, of course, makes accurate real-time pricing impossible since the market makers won't necessarily know what they're buying or selling.

David