Investment Management Partner Discusses SEC Relief for ETMFs in Compliance Intelligence

Investment management partner Brian McCabe (Boston) is quoted in a Nov. 14 Compliance Intelligence article titled “CCOs Advised on New Actively Managed ETF Relief,” discussing the SEC’s recent relief allowing new exchange-traded managed funds (ETMFs). This product would be a “non-transparent ETF,” which would have quarterly, not daily, disclosure obligations. In addition to the different disclosure requirements, the ETMFs will trade either at a premium or discount to the fund's net asset value, which would be determined at the end of each trading day. Mr. McCabe notes compliance officers should consider monitoring the premiums and discounts at which ETMF shares trade during the day. He also highlights that this new product could potentially face unique risks associated with the miscalculation of a funds’ net asset value.