Partner Peter Shea Quoted in Bloomberg on BlackRock Short-Sale ETFs

Peter Shea, a partner in the firm’s Financial Services Practice, was quoted in a Bloomberg article on BlackRock Inc.’s request for regulatory clearance to create exchange-traded funds (ETFs) that can bet against stocks or bonds. BlackRock applied with the Securities and Exchange Commission for the right to engage in short sales when running ETFs that track market indexes. Mr. Shea says that firms like BlackRock are exhausting the market for ETFs that track traditional benchmarks, such as the Standard & Poor’s 500 Index, and that the ability to engage in short sales would help such firms expand into other areas once dominated by money managers using active strategies. “Sponsors of ETFs are cognizant that their growth has come at the expense of managed mutual funds,” he says. “To lock in that growth, there is a movement towards diversifying their products into strategy-based ETFs.” (“BlackRock Seeks to Sell Index ETFs That Can Short Stocks, Bonds,” August 10, 2010)