On Sept. 18, Bloomberg published an article authored by investment management Ed Baer titled “INSIGHT: The SEC’s Proposed ETF Rule Creates Fintech Opportunities” that discusses how the SEC’s proposed ETF rule may creates fintech opportunities. The article also appeared in Bloomberg’s Banking Daily, Bloomberg’s Securities Daily and Bloomberg BNA.
The ETF industry has waited a long time for an ETF Rule, and now that the Rule seems to be on its way, fintech is poised to play an increasingly important role, Mr. Baer outlines, also asking “Should that make ETF sponsors nervous?” Mr. Baer outlines how fintech companies could develop compliance software that would enable ETF sponsors to forecast the impact of a custom basket prior to acceptance, as well as to analyze the actual impact after the basket has been accepted into the ETF’s portfolio. However, Mr. Baer also adds that low barriers to entry and significant investment flexibility might entice fintech firms into the ETF industry. With financial technology holding valuable consumer data, it could chose to couple this with highly customized ETFs targeted towards cohorts of similarly situated customers, Mr. Baer writes, noting that the ETF Rule could make this scenario quite plausible.
Mr. Baer’s article was also featured as one of ETF.com’s Sept. 26 “Hot Reads.”
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