Amplify ETFs has filed for an ETF that will look to provide exposure to what its prospectus refers to as the “crowdfunding ecosystem.” The Amplify CrowdBureau Peer-to-Peer Lending & Crowdfunding ETF will target companies that provide individual loans that are sourced from multiple individuals or institutions.
There are really two types of transactions in this area. Peer-to-peer lending essentially involves investors buying notes that entitle them to fractional interest in a particular loan. Equity crowdfunding involves investors buying a privately held company’s debt or equity securities in order to give the company the financing it is seeking, the prospectus says.
The fund’s underlying index can include peer-to-peer lending and equity crowdsourcing platforms that primarily serve individuals and small businesses; financial institutions that offer crowdfunding platforms among their other services; companies offering technology and software solutions for crowdfunding platforms; and social networking platforms that can be used to facilitate crowdfunding.
Securities in the index must be listed on a U.S. exchange and have at least $75 million in market capitalization in addition to meeting liquidity and other listing requirements, the document says.
Each of the four buckets are assigned a fixed weight in the index. Within the financial institutions category and the social networking platforms category, components are equally weighted. However, within the general crowdfunding platforms, and technology and software provider platforms, companies are weighted by modified market capitalization, according to the document.
The filing did not include an expense ratio or ticker, but did indicate the fund will list on the NYSE Arca.
Amplify has a number of ETFs that seek to capitalize on “new economy” trends. Its largest fund is the Amplify Online Retail ETF (IBUY), which has $519 million in assets under management. Meanwhile, its blockchain fund, the Amplify Transformational Data Sharing ETF (BLOK), has $163 million.
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