SEC Takes Dim View Of Nontransparent Active ETFs

The Securities and Exchange Commission is pushing back against an effort to create actively managed exchange-traded funds that wouldn't have to disclose their holdings daily. The regulatory agency said in a notice dated Tuesday that it plans to deny an application from Precidian Investments that sought an exemption from daily portfolio transparency for such active ETFs. Many traditional mutual fund companies have been hoping the SEC will permit so-called "nontransparent" active ETFs, because that would allow the companies to use ETFs as a wrapper for their existing offerings without having to reveal holdings each day. Individual investors and financial advisers aren't clamoring for such products, a Morningstar analyst said last month.