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Hidden-Asset ETFs Test Appetite for Active Managers Amid Rout

  • American Century’s active non-transparent funds set for debut
  • Industry says that active managers often shine amid volatility

A new type of exchange-traded fund is debuting after more than a decade of being touted by the industry as the next big thing, testing appetite for actively-managed funds in the midst of historic volatility.

These so-called non-transparent ETFs allow issuers to hide holdings, easing the way for stock pickers to pursue their strategies without the fear of rivals copying their plans or frontrunning the trades. Two offerings from American Century -- one focused on growth, the other on value -- begin trading Thursday.