Morningstar: 4 ETF Myths Debunked

Myth 3: Only ETFs Lend Securities
On more than one occasion, I have heard ETFs criticised for engaging in the ‘funny business’ of securities lending, which sees a percentage of fund holdings lent to a third party in exchange for a fee.
While securities lending is widely practised within physically replicated ETFs, it is actually traditional mutual funds, pension funds and insurance companies which are the biggest lenders of assets.
In fact, ETF providers in Europe are considerably more transparent than their active counterparts. They provide information relating to their lending activities, including on-loan levels, collateral guidelines, counterparties, on their websites.
The full article is available here.

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