The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site.

All material subject to strictly enforced copyright laws. © 2020 Euromoney, a part of the Euromoney Institutional Investor PLC.
Capital Markets

Goldman files for ETF that will keep holdings secret

In applying for exemption to the requirement to disclose an ETF’s portfolio, Goldman Sachs joins a small group of firms testing a new approach.

Goldman-Sachs-NYSE-US-flag-R-780.jpg



Goldman Sachs has filed for a new exchange-traded fund (ETF) that it is asking the SEC to exempt from the usual requirement to publish a daily breakdown of its underlying holdings.

In doing so, it becomes the latest of a small band of issuers to have sought the exemption, which was first granted to Precidian Investments in April when it created the ActiveShares ETF model that Goldman will use.

It also adds to the push of the ETF sector into areas of active management, a trend that might help mitigate signs in 2019 that passive investment fatigue might be setting in.

In its marketing materials, Goldman will tell investors that “this ETF is different from traditional ETFs”.

Typically, the SEC requires disclosure of an ETF’s portfolio every day to facilitate the arbitrage mechanism that enables ETF shares to trade close to the net asset value (NAV) of the underlying holdings.

However, Goldman noted that the SEC had recently allowed other actively managed ETFs, such as Precidian, to avoid such disclosures and instead find other ways of enabling the arbitrage process to take place.

Verified intraday indicative value

The new ETF will use a similar mechanism to that at Precidian, with the funds calculating a verified intraday indicative value (VIIV), which will be disclosed every second of a trading day.




You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree