Active ETFs likely to fuel growth in US market
US - The growth of the US ETF market is likely to be driven by active ETFs as a number of potential new issuers are seeking to list them, according to the New York Stock Exchange.
The exchange is seeing a healthy flow of issuers preparing to enter the US market. "Our pipeline continues to be quite robust and we have new prospect issuers coming to us with a high frequency," said Laura Morrison, vice president, global index and exchange-traded products at NYSE.
"One thing which caught our eyes last week was that Goldman Sachs Asset Management amended their regulatory filing. There are others who have been silent for several months and now they are indicating that they are re-engaged and that is exciting for our team."
Of these there is an increasing number of companies which are interested in listing active ETFs. "[There is] heightened interest in the active transparent product type. We only have 41 listed on our exchange now, there is a decent number of new pending active ETF issuers that we are speaking with," said Morrison.
"I would say more often than not the new prospect issuers that come to us have questions about the process for active, they are definitely the majority of the interest that comes to us."
Companies such as AllianceBernstein, Dreyfus, State Street and JP Morgan are all taking steps towards launching active ETFs. Morrison said that this is potentially where the growth of the market will be.
She also notes the filing that BlackRock recently made for a non-transparent actively managed ETF, which will only report its holdings with the same frequency as a mutual fund.
"Firms are scoping out new opportunities in this space to be able to attract assets with these first to market opportunities," she said. "It proves that while there are almost 1300 products available to us in the US there are a lot of interesting and unique ideas."
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