Semi-transparent active ETF

A semi-transparent active ETF is an actively managed ETF that does not disclose its full portfolio holdings every single day the way most ETFs do, instead revealing its positions on a delayed basis, such as monthly or quarterly, similar to how a traditional mutual fund discloses holdings. It still trades on an exchange throughout the day like any other ETF, and it still relies on authorized participants and the normal creation and redemption process to keep its market price close to net asset value.

This structure exists specifically to solve a problem active managers faced when the ETF format first became popular. A standard ETF discloses its full holdings every day, which makes it easy for other traders to see exactly what a manager owns and potentially trade ahead of or copy that manager's strategy, undermining the value of the manager's research. A semi-transparent structure lets a fund company offer an actively managed strategy in the ETF wrapper, with its lower costs and tax efficiency, while still protecting the manager's specific holdings from being fully visible in real time.

Because authorized participants cannot see the exact daily holdings the way they can with a fully transparent ETF, semi-transparent active ETFs typically rely on alternative methods, such as a published proxy portfolio that approximates the fund's actual exposure, to keep the creation and redemption process functioning and the market price aligned with NAV. This has generally worked well in practice, though semi-transparent active ETFs remain a smaller, more specialized corner of the ETF market compared with fully transparent active and passive ETFs.