The popularity and growth of ETFs is taking its toll at the SEC. They just can keep up with those waiting to be approved. The Wall Street Journal reports:

“ETFs, which essentially are mutual funds that trade on
exchanges like shares of stock, still occupy a relatively small corner
of the investment universe. But they have blossomed recently, thanks to
their low fees and tax advantages. ETF assets have more than tripled to
$335 billion in the past four years. There are now more than 215
offerings, nearly twice the 113 in 2002.

But amid a rush by money-management firms to add
offerings, applications for new ETFs — which require regulatory
approval — are piling up at the Securities and Exchange Commission.
The SEC recently said it has 23 pending applications for ETFs.
Applications can include as many as several dozen individual funds.
More than half have been pending for at least six months.

The SEC has promised to speed things up. The division
that plays a big role in approvals “is conducting a top-to-bottom
review” of its ETF process and “looking for opportunities to make the
process routine,” said SEC Chairman Christopher Cox in an interview,
calling the changes “a priority.” Mr. Cox was asked about the issue
last month at a hearing of the House Committee on Financial Services.”

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