Why Markets Could See Mutual Funds Convert to ETFs

The video discusses nontransparent ETFs, which do not display holdings daily, appealing to active managers who wish to avoid front-running. It highlights examples like NextShares and Presidian's active shares, noting market demand. The video also explores the legal feasibility of open-end funds converting to ETFs, as suggested by Ropes and Gray, to maintain track records and address outflows. Active managers face challenges with significant outflows, and converting to ETFs may offer a solution.

What are the main reasons active asset management firms are hesitant to enter the ETF space?

What is the significance of the approval received by presidian for active shares?

What potential benefits could open-end funds gain by converting to ETFs?

What challenges do active managers face when considering the conversion to active shares?

How have active managers' equity mutual funds performed in terms of outflows over the last decade?