Blue Tractor Group has filed an eighth amended and restated application with the US Securities and Exchange Commission (SEC) for its innovative Shielded Alpha ETF structure for use by active portfolio managers.
The Shielded Alpha ETF structure would be highly transparent and would disseminate daily to the market a creation basket (PCF) consisting of 100 per cent of the securities in the fund’s actual portfolio but importantly, not their actual portfolio weightings, thereby fully obscuring an active manager’s alpha generation strategy. A Shielded Alpha ETF’s creation basket weightings would have a minimum 90 per cent asset value overlap with the fund’s actual portfolio weightings at the beginning of each trading day. As such, a Shielded Alpha ETF would not be a non-transparent ETF, but rather a highly transparent ETF.
Because a Shielded Alpha ETF would not be a non-transparent ETF, Blue Tractor’s proposal would provide asset managers additional choice over what type of actively managed ETF structure to utilise.
Terry Norman, Founder of Blue Tractor, says: “We continue to refine and enhance the Shielded Alpha℠ ETF framework. Our new application would allow for actively managed ETFs with portfolios consisting of large, mid and small cap domestic equity securities, as well as American Depositary Receipts.”
Added Simon Goulet, Co-Founder of Blue Tractor, says: “We filed our seventh application with the SEC approximately six weeks ago and the SEC has been most constructive as we finalised this latest filing. We remain buoyed by their flexibility and positive engagement.”
