Nasdaq Hosts Panel Discussion on ETF Conversions, Share Class Issues

Nasdaq recently hosted a panel of experts from Brown Brothers Harriman, Cohen & Company, and K&L Gates to discuss trends in ETF conversions and ETF/multi-share class proposals. The panel discussed which investment strategies may benefit most from ETF conversions, considerations include the type of holdings, the transparency requirement of ETFs, and the distribution footprint. The panel also highlighted the operational hurdles when converting, including shareholder issues (do shareholders have brokerage accounts), transfer of assets, and communication with distribution partners. The set-up of the ETF itself also requires new workflows, engaging authorized participants, and requirements to display daily holdings. Additionally, the panelists highlighted the importance of understanding the differences in taxation, and how that will impact shareholders.

Click here to watch the Nasdaq panel video.