Fidelity Investments has filed with securities regulators to create a new type of exchange-traded product that would make use of its active investment management offerings.
The Boston-based investment giant has been taking steps to compete in the fast-growing exchange-traded fund arena, where lower-cost funds are taking market share away from traditional mutual funds.
Fidelity is calling its new offerings “exchange-traded active funds.” They would not be transparent on a daily basis, meaning there would be a 30-day lag for investors to know the precise stocks or bonds held in the fund.
These funds would trade on a stock exchange and track a comparable ETF. Such products generally allow easier trading than mutual funds, which price only once at the end of each day, versus ETFs, which are priced all day long.
Fidelity spokeswoman Nicole Goodnow said the regulatory process for the new investments has just begun. “We look forward to an active, constructive dialogue” with the Securities and Exchange Commission, she said.
The SEC in July approved a new rule to ease the listing process for actively managed ETFs.