Content area
Full Text
The Securities and Exchange Commission's recent proposals aimed at easing the burdens of providers bringing new exchange-traded funds to market should make new ETF launches an easier proposition while fostering even more product creativity, said investment management sources.
Last week the SEC proposed rules aimed squarely at the $569 billion and growing ETF marketplace which, at the end of January 2008, included more than 600 investment products.
"ETFs are one of the most popular innovations in pooled investments in the last quarter century," said SEC Chairman Christopher Cox in announcing the proposed regulations.
Proposed Rule 6c-11 to the Investment Company Act of 1940 would allow ETFs to operate without first having to formally obtain an individual SEC exemptive action. The new rule would codify the predominance of previously granted exemptive relief actions to new ETFs seeking to list and trade shares on an exchange.
ETFs have been required to seek such explicit exemptive relief from the SEC because ETFs, first created in 1993, do not neatly fit into the types of investments allowed under the 1940 Act which...