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ETF Legal Underwriting


Established mutual fund provider sees benefits in outsourcing ETF operations

The Brief:

A well-established, $178B investment advisor who has been in the asset management space since 1924 approached Foreside in 2017 when they were contemplating launching a suite of exchange-traded funds (“ETFs”).  It is important to note that this firm already managed a robust family of mutual funds, owned and operated its broker-dealer as principal underwriter for its mutual funds, and maintained FINRA licenses for registered representatives that market the firm’s products.  Despite this, the firm lacked the knowledge and expertise to support ETFs.

The Approach:

Over the past decade, Foreside has established itself as a market leader in supporting new and innovative ETF launches, having developed an outstanding reputation with the industry’s lead market makers (LMMs) and Authorized Participants (APs). Through in-depth discussions showcasing Foreside’s expertise in the ETF distribution space, the firm chose to engage with Foreside as its legal underwriter.  In January of 2018, the firm successfully launched its first ETF. The firm has since grown its product suite to twenty ETFs with $3.9B in AUM.   This includes two separate Non-Transparent ETF models.

The Result:

During this exciting period of growth, Foreside has served as an integral partner for the firm.  Foreside acted as distributor to the firm’s expanding product line-up which included the first active non-transparent product to market via the Precidian model.  The firm was also an early adopter of the NYSE AMS (Actively Managers Solutions).  Foreside has facilitated and executed over a dozen AP agreements for the firm’s ETFs and worked closely with the client to develop and execute three Authorized Participant Representative (APR) agreements, a new but essential component to the launch of their active non-transparent products.   In furtherance of the partnership, Foreside regularly meets with the firm and each respective service team to ensure open communication, ongoing support, and the sharing of new information and trends to support the firm in its distribution efforts.

As the firm continues to grow they have increasingly looked to Foreside for expanded compliance support, including the review and filing of marketing materials not only for their ETFs but also for their mutual fund product suite and separately managed accounts



All situations are evaluated, and results may be different depending on the situation. It is important to note these case studies are not testimonials but examples of strategies that have been deployed to assist our clients. These examples may not be representative of your experience with Foreside and do not guarantee that you will experience the same or similar results.

Foreside and its affiliates do not provide tax, legal, or accounting advice. The case studies are provided for informational use only and should not be relied on for tax, legal, or accounting advice.