00:00If your question is, you know, can you have 100% private credit in, you know, as a standalone ETF, I think that's challenging.
00:07I think that, you know, when we look at the wrapper versus the underlying, people like to think of, well, you know, you just, the wrapper has to just, you know, go around the underlying and then somehow it'll work.
00:20I do think there's a bit of a, you know, a tug here, a push and a pull where the underlying market has to evolve as well, right?
00:27And so it needs to, it needs to get to a place of transparency and not necessarily, I mean, liquidity is a relative word, but there needs to be, you know, more evolution in trading, you know, market structure, et cetera, et cetera, before you could say, oh, sure, you could have, you know, a standalone product with 100%.
00:44We're not there.
00:45And so we continue to watch it and we continue to think of different, you know, concepts around, you know, what's the best way to deliver it.
00:52But it's challenging to say here is a standalone 100% private credit product at this point.
00:59Yeah, that's really interesting.
01:00I mean, Rick, to Steve's point that you've done this in the mutual fund wrapper, you know, having that slice of private credit, that's something that you can do in the ETF.
01:10JP Morgan, for example, has a filing out there where private credit would just be a little bit of a slice of a total credit ETF.
01:18But I'm curious, you know, how you think about that.
01:21I mean, would you ever put, you know, that up to the 15% illiquid cap in an ETF?
01:27So, you know, I think that, I think if you fast forward five years from now, I think the concept of private and public, I think, will be completely blurred.
01:37Today, when I look at an asset, you know, we look at what is its, what is its beta, its dispersion, its marginal contribution to risk, what's its liquidity, and then what does it do in the portfolio?
01:47Today, you know, it's saying, Steve made the point, which is 100% right.
01:50In fixed income, our goal is to get paid back, and we run very different in fixed income than we do equities.
01:56Like, I believe you diversify fixed income.
01:58You know, when you take public-private, this number is staggering to me, there's 1.4 million unique fixed-income securities.
02:07You know, I run a big equity portfolio.
02:09You know, I've got to watch 30 stocks, basically.
02:12There's 1.4 million.
02:13If I could use privates, now, in the ETF structure, different than a mutual fund, I'm trying to create something that is liquid, replicatable.
02:21So, I try and keep that number smaller.
02:23By the way, it's part of why mutual funds are not going away.
02:26Like, your ability to actually get-
02:28This is the ETF crowd.
02:29I understand.
02:30But it's actually, you know, listen, the benefits of ETFs are going to grow much faster, and Steve knows way better than I, the efficiencies and the reasons.
02:37It's going to grow much faster, but I can put, I just can't put as much in the ETF as I would in the mutual fund.
02:44So, what do I do?
02:45I give up a little bit of yield.
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