State Street has been appointed as exchange-traded fund (ETF) servicing agent for American Century Investments and first authorised participant representative (APR) for American Century Investments’ new range of semi-transparent, actively managed ETFs.
American Century Investments is the first asset manager to receive regulatory approval for two investment strategies, focused large cap value and focused dynamic growth, both of which will be available through ActiveShares, its semi-transparent active ETF vehicle.
As part of the agreement, State Street will provide services including basket creation, dissemination, settlement, custody, fund accounting, order-taking, financial reporting and transfer agency services to American Century Investments' new suite of funds.
State Street, through its affiliated broker dealer within its global markets division, will also serve as the first APR in the ActiveShares ecosystem.
The APR is a “new and pivotal role”, serving as an agent for the execution of the underlying confidential portfolio holdings, and standing in between the authorised participant and the investment manager to protect the confidentiality of the portfolio holdings, according to State Street.
Meanwhile, American Century Investments will utilise Precidian Investments' ActiveShares methodology, allowing the firm to deliver its actively-managed investment strategies in ETF vehicles without the daily holdings disclosure requirement of fully transparent ETFs.
Frank Koudelka, global ETF product specialist at State Street, commented: “The approval of semi-transparent ETFs opens a whole new category of opportunity for active managers and investors.”
“We are delighted to be working with American Century Investments on this unique offering and look forward to using our extensive experience, expertise, and innovative ETF servicing technology to support the firm with this exciting new product.”
Ed Rosenberg, senior vice president and head of ETFs for American Century Investments, added: “We believe that semi-transparent ETFs expand the opportunity set to managers and strategies that had previously not been available, providing additional choices for investors.”
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