Archive: https://archive.is/2025.03.27-042229/https://www.ft.com/content/864c6f2b-fd6e-448d-b67b-f208eb89d879
A flurry of new exchange traded funds is widening retail access to the fast-growing markets for private credit and equity, sparking concerns that these assets are a poor fit for small-scale investors and could prove tough to sell during a crisis.
A private credit ETF launched last month by State Street will hold up to 35 per cent of its portfolio in private debt deals originated by Apollo Global Management. Fixed-income specialist BondBloxx, meanwhile, has applied for regulatory approval for an ETF that could hold up to 80 per cent of its portfolio in private credit.
But the US Securities and Exchange Commission last month raised a number of concerns about the State Street launch, enquiring about plans for mitigating liquidity risk and ensuring accurate pricing.
While the regulator eventually signed off on the fund after State Street provided more information and changed the name, many industry executives remain unconvinced that assets typically bought by investors who can lock up capital for years are suited to daily liquidity fund vehicles that, until now, have mostly held easy-to-sell securities
It’s an interesting one. I want access to non publicly listed investments, but I have unfortunately lost money in funds that tried it.
To do it, you either need a closed fund, or something kind of buy/sell restrictions to force long term investment.
