{"id":5678,"date":"2014-10-23T00:00:00","date_gmt":"2014-10-23T05:00:00","guid":{"rendered":"https:\/\/institutionalinvestorsecuritiesblog.blawgcloud.com\/2014\/10\/sec_to_reject_blackrock_inc_pr"},"modified":"2022-03-11T13:33:39","modified_gmt":"2022-03-11T19:33:39","slug":"sec-to-reject-blackrock-inc-pr","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/sec-to-reject-blackrock-inc-pr\/","title":{"rendered":"SEC to Reject BlackRock Inc. Proposal for Nontransparent Exchange-Traded Fund"},"content":{"rendered":"\n<p>In a preliminary ruling, The U.S. Securities and Exchange Commission said it expects to reject BlackRock Inc.\u2019s (BLK) proposal to put out a nontransparent exchange-traded fund. BlackRock sought permission to sell the ETF from the regulator in 2011. <\/p>\n<p>The fund wants to keep its investments secret, which go against SEC rules. BlackRock proposed using a blind trust to manage the securities of a portfolio without revealing the contents. It sought exemption from the agency\u2019s rules, which mandate that disclosure be provided daily. Instead, BlackRock would have disclosed its holdings with the nontransparent ETF on a quarterly basis. One reason that certain fund managers are pushing for less frequent disclosure is their worry that daily disclosures could allow investors to imitate the trades. <\/p>\n<p>Now, however, the SEC is saying that without portfolio transparency such as a plan does not guarantee that that the ETF would trade consistently or near net asset value. The regulator said that the proposed structure sets up substantive risk that ETF share market prices might materially deviate from the ETF\u2019s NAV\/share, especially during stressful periods in the market. This could \u201cinflict substantial cost on investors,\u201d noted the Commission.<\/p>\n<div class=\"read_more_link\"><a href=\"https:\/\/www.investorlawyers.com\/blog\/sec-to-reject-blackrock-inc-pr\/\"  title=\"Continue Reading SEC to Reject BlackRock Inc. Proposal for Nontransparent Exchange-Traded Fund\" class=\"more-link\">Continue Reading \u203a<\/a><\/div>\n","protected":false},"excerpt":{"rendered":"<p>In a preliminary ruling, The U.S. Securities and Exchange Commission said it expects to reject BlackRock Inc.\u2019s (BLK) proposal to put out a nontransparent exchange-traded fund. BlackRock sought permission to sell the ETF from the regulator in 2011. The fund wants to keep its investments secret, which go against SEC rules. BlackRock proposed using a [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[4023,3760,3761],"tags":[2706,3450],"class_list":["post-5678","post","type-post","status-publish","format-standard","hentry","category-exchange-traded-funds","category-sec-enforcement","category-securities-and-exchange-commis","tag-blackrock","tag-nontransparent-exchange-traded-funds"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>SEC to Reject BlackRock Inc. Proposal for Nontransparent Exchange-Traded Fund &#8212; Investor Lawyers Blog &#8212; October 23, 2014<\/title>\n<meta name=\"description\" content=\"In a preliminary ruling, The U.S. Securities and Exchange Commission said it expects to reject BlackRock Inc.\u2019s (BLK) proposal to put out a nontransparent &#8212; October 23, 2014\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.investorlawyers.com\/blog\/sec-to-reject-blackrock-inc-pr\/\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:title\" content=\"SEC to Reject BlackRock Inc. 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Proposal for Nontransparent Exchange-Traded Fund &#8212; Investor Lawyers Blog &#8212; October 23, 2014","twitter_description":"In a preliminary ruling, The U.S. Securities and Exchange Commission said it expects to reject BlackRock Inc.\u2019s (BLK) proposal to put out a nontransparent &#8212; October 23, 2014","twitter_misc":{"Written by":"Shepherd Smith Edwards &amp; Kantas, LLP","Est. reading time":"2 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.investorlawyers.com\/blog\/sec-to-reject-blackrock-inc-pr\/#article","isPartOf":{"@id":"https:\/\/www.investorlawyers.com\/blog\/sec-to-reject-blackrock-inc-pr\/"},"author":{"name":"Shepherd Smith Edwards &amp; Kantas, LLP","@id":"https:\/\/www.investorlawyers.com\/blog\/#\/schema\/person\/e0240e0754684b69f7d6a7de1b9f1431"},"headline":"SEC to Reject BlackRock Inc. 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