Securities lending has evolved since its birth into a mutually beneficial and low-risk practice for both investors and fund sponsors. In our new report, “An Inside Look at Securities Lending,” we explore the potential benefits investors stand to gain from the additional income that can offset fund fees, as well as how fund sponsors can use securities lending to improve peer-relative performance. What Is Securities Lending, and How Does It Work? Securities lending entails a fund lending out portfolio securities (like stocks or bonds) to an interested party, such as a broker/dealer or hedge fund, for a tidy fee. Securities Lending: Proceed With CautionSecurities lending plays a small role in overall fund management, but it’s a useful tool for offsetting fund expenses and slightly boosting returns.

Source: Forbes August 30, 2023 18:55 UTC