Get the advisory support you need to successfully navigate this complex process.
Adopted by the Securities and Exchange Commission in 2019, the ”ETF Rule” (Rule 6c-11) lowers the barriers to entry and levels the playing field for all sponsors of new exchange-traded funds.
With the adoption of the Rule, ETFs organized as open-end funds are no longer required to operate pursuant to an SEC exemptive order from the 1940 Investment Companies Act. Instead, sponsors now only need to meet certain conditions, including standardized disclosure requirements focused on portfolio transparency and fund pricing data.
The new regulatory framework also allows for the construction and acceptance of custom baskets and orders across all ETFs covered by the Rule as long as they are in accordance with written policies and procedures governing such activities.
Taken together, these changes allow new funds and strategies to come to market significantly faster than in the past and enable financial advisors, asset managers, and other ETF sponsors to operate their funds as efficiently as possible.
Though easier than ever, launching an ETF requires significant planning and coordination across a broad range of stakeholders. Once it is up and running, managing the fund involves operational and regulatory nuances that may be unfamiliar to many financial advisors and traditional asset managers.
• SEC Rule 6c-11 requirements
• Website disclosures
• Clearing and exchange requirements
• Third-party reporting
• ETF seeding process and timeline
• Identifier acquisition
• Basket construction
• Service provider engagements and coordination
• Creation/redemption lifecycle
• Order tracking
• Basket cash component methodologies and optimization
• Custodian and service-provider coordination
• Authorized participant and market maker communication
Phil has 13 years' experience working at leading global players in the ETF services industry, where he has led numerous exchange-traded fund launches involving a broad range of strategies and asset classes as well as sponsors of varying sizes and capabilities. With expertise in all phases of ETF operations, he advises small and mid-size financial firms on the myriad requirements and processes associated with the stages leading up to and following a successful launch. Phil is also skilled in training and development, able to deliver comprehensive knowledge and insights about the ETF operational ecosystem. Originally from the New York area, Phil has a BS in business from the College of Charleston and currently resides in Tampa, Florida.