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An ETF That Hides Its Secret Sauce Is Poised for Regulator's Nod

  • Precidian gets go-ahead for active non-transparent funds
  • The structure seeks to mitigate the risk of front running
The U.S. Securities and Exchange Commission (SEC) seal is displayed outside headquarters in Washington, D.C., U.S.
The U.S. Securities and Exchange Commission (SEC) seal is displayed outside headquarters in Washington, D.C., U.S.

Photographer: Andrew Harrer/Bloomberg

An exchange-traded fund that doesn’t have to reveal its assets is poised to get the regulator’s blessing after a more than four-year wait.

The U.S. Securities and Exchange Commission plans to issue an order granting Precidian Funds permission for the new type of ETF, the watchdog said in a notice Monday. Market participants can still request a hearing through May 3, the regulator said; if granted, that could potentially delay or derail the final approval. The funds also need permission to start trading from another division of the SEC.