Single security ETF launches have been all the rage this summer, but regulators are now sounding the alarm. Broker-dealers that sell single-stock ETFs in Massachusetts are being investigated by regulators according to Massachusetts Secretary of States William F. Galvin. Galvin has directed his Securities Division to investigate Mass-based registered broker-dealers that sell single stock ETFs to retail investors. He believes that the leverage used to magnify gains and losses in single stocks is not suitable for "Main Street" investors. This follows a statement by SEC Commissioner Caroline Crenshaw earlier in the summer in which she stated that the approval of single-stock ETFs posed a “greater risk” for investors than index-based leveraged and inverse ETFs. She also stated it would be difficult for advisors to recommend these products while meeting their Reg BI obligations.

Finsum:Regulators are sounding the alarm on single-stock ETFs, indicating that advisors may be in breach of Reg BI for recommending them.

Fund giant BlackRock is warning regulators that the SEC's new proposed rules to fight greenwashing by fund managers could create more confusion and lead investors to think their holdings are more socially conscious than they are. Specifically, the firm is concerned over a key detail in the proposal that would require managers to say how ESG issues fit into strategies that also consider other factors. It sent a letter to the SEC arguing that the detail could mislead investors about how much environmental, social, and governance issues factors into stock and bond decisions. The SEC had proposed new regulations for ESG funds in May, which are expected to be finalized in the coming months. BlackRock’s argument has been echoed by industry trade groups such as the Investment Company Institute and the Managed Funds Association. However, these arguments are unlikely to stop the SEC’s crackdown on ESG labels.

Finsum:Blackrock sent a letter to the SEC warning that the new proposed rules on ESG labels will only muddy the waters.

In the aftermath of what had been a sweet buzz of a ride, stocks are embroiled in another unwelcome turn, according to ally.com. Last week, of course, the S&P 500, bless it, threw in the towel of what had been a four-week run. This week? You go it; the setback continues.  

So, what’s up with that? Well, let’s count the uncertainties. Corporate earnings season’s winding down. Summer? Vaulting into the rear view mirror. And the news cycle will slow to a trickle. It all spells a vacuum in solid direction which, right again, puts air under the likelihood of volatility, the site continued.

In fact, taking, well, stock, of the interest rate trend lines over this  summer, they’re more rocky than stable, according to money.usnews.com. The swings in the average 30 year fixed rates have been madcap, percolating and descending by as much as a quarter point per seek following a mid June peak to 5.81%.

The 30-year fixed rate went back up to well over 5% this week -- a reminder that recent volatility remains persistent, said Sam Khater, vice president, chief economist and head of Freddie Mac’s Economic and Housing Research division. “Although rates continue to fluctuate, recent data suggest that the housing market is stabilizing as it transitions from the surge of activity during the pandemic to a more balanced market.” 

U.S. Treasury yields rose on Monday with the benchmark 10-year yield hitting a five-week peak of 3.039%, while the 30-year yield climbed to a seven-week high of 3.268%. Yields rose as investors await a Federal Reserve gathering occurring later this week in Jackson Hole, Wyoming. The Fed is widely expected to reinforce its commitment to tackling inflation. Fed Chair Jerome Powell is scheduled to speak Friday morning at the Jackson Hole symposium. Last week's Fed minutes appeared to suggest that the Fed is on course to continue to increase interest rates with the central bank seeing "little evidence" that inflation was easing. The auction for shorter-dated coupons this week also added to the sell-off in Treasuries, pushing their yields higher. Traders typically sell Treasuries before an auction and then buy them back at a lower price. 

Finsum: Treasuries hit multi-week highs on Monday as investors await Fed Chair Jerome Powell’s speech on Friday morning at the Jackson Hole symposium.

iCapital, a leading global fintech platform, announced today that it agreed to acquire UBS Fund Advisor LLC, UBS’s legacy proprietary US alternative investment manager. The agreement also includes the feeder fund platform that UBS manages. The platform, which is also referred to as “AlphaKeys Funds,” represents more than $7 billion in client assets. It includes private equity, hedge fund, and real estate feeder funds. iCapital will now manage and operate the platform, while UBS Financial Advisors continue to serve their high and ultra-high net worth clients that hold feeder funds. UBS became an investor in iCapital in 2017 and entered into a strategic relationship to structure new feeder funds going forward. It also integrated iCapital’s proprietary technology into its private fund operations. In 2021, the partnership was enhanced to further digitize the UBS Advisor experience. The transaction is expected to close sometime this year.

Finsum:iCapital, which has had a long-standing relationship with UBS, is acquiring its Alternative Investments Feeder Fund Platform which represents more than $7 billion in client assets.