The word transparency might sound like one of those platitudes endlessly parroted in TikTok videos and self-help posts, but when it comes to big choices around technology, relationships, and even investing, transparency isn't a meaningless buzzword used to garner followers; it's a principle that can have lasting consequences.
That’s why so many investors—19.8 million US households to be exact—trust ETFs with their long-term investment dollars.1 ETFs were built with transparency in mind, with most funds disclosing their holdings on a daily basis. Because of this visibility, investors can better understand their risks, avoid unwanted overlap, and decide whether the fund is consistent with their long-term goals. Let’s dig deeper.
A quick refresher: what is an ETF?
An exchange-traded fund (ETF) is a basket of securities — stocks, bonds, commodities, or a mix — that trades on a stock exchange like an individual stock, meaning you can buy and sell an ETF throughout the day at prices determined by the market. Put together, ETFs bring together the diversification of a mutual fund, the flexibility of a single stock, and the transparency of, well, an ETF.
So it’s no surprise that ETFs have become one of the fastest-growing investment vehicles in the world, with almost $21 trillion parked in global ETFs as of May 2026, up from less than $1 trillion back in 2008.2
So what does ETF transparency mean?
When we say transparency, we’re talking about how clearly and how often an ETF discloses its holdings. A fully transparent ETF publishes a complete list of holdings daily. Any day of the week, you can check the fund's website and see exactly what stocks or other securities are held in the fund with no lag and no question left unsatisfied.
Historically, it is this daily disclosure that has set ETFs apart from mutual funds. Currently, mutual funds must report their holdings monthly, and then it takes another 60 days before this information becomes publicly available. By the time you find out what a mutual fund manager was buying in January, it's April and public sentiment could have shifted.
With a fully transparent ETF, however, you always know what you own.
The transparency spectrum: not all ETFs disclose the same way
Of course, not every ETF is fully transparent. Others can be semi-transparent or even non-transparent.
Fully transparent ETFs publish their complete holdings daily. This is the traditional ETF structure and still the most common. Investors, analysts, and the arbitrage mechanism that keeps ETF prices closely aligned with the value of underlying assets all depend on this openness.
Semi-transparent ETFs were introduced in the U.S. starting around 2020. They were designed to allow active managers to run an ETF without giving away their strategy in real time. Instead of daily full holdings, they might publish a proxy basket, which is a representative set of holdings that tracks the fund's performance without revealing every detail. The SEC approved several semi-transparent structures as a compromise between transparency and competitive confidentiality.3
Non-transparent ETFs take this further, offering very limited real-time disclosure. These are rare and controversial, in part because the reduced transparency can widen the spread between an ETF's market price and its actual net asset value. In an ideal world, the gap between these two is narrow.
Where can you find a fund's holdings?
For fully transparent ETFs, the holdings list is typically published daily on the fund provider's website. You can also find this information on financial data platforms like Morningstar® or ETF.com, which aggregate holdings data across thousands of funds. For semi-transparent funds, look for the proxy basket disclosure or the fund's most recent regulatory filings on the SEC's EDGAR database.
At Motley Fool Asset Management, our ETFs are all fully transparent, so you can find a list of daily holdings published on any of our fund pages.
Why transparency is beneficial
Transparency has real and practical consequences for your portfolio.
Avoid unintended overlap. If you hold an S&P 500 index fund and you're thinking about adding a second ETF, knowing both funds' holdings tells you whether you're actually diversifying or just doubling down on, say, the same 50 tech stocks.
Manage risk more precisely. Knowing that a fund holds a large position in a single sector or region can help you make informed decisions about your overall portfolio balance.
Keep fees honest. When you can see exactly what a fund holds, it's easier to evaluate whether you're paying for active management that's actually doing something different or just closet indexing at a premium price.
Hold fund managers accountable. Sunlight is the best disinfectant, as the saying goes. Daily disclosure creates a natural check on drift, style inconsistency, and excessive risk-taking.
Transparency matters even more for Active ETFs
So far, we’ve taken a 10,000-foot view, treating transparency equally for both active and passive ETFs. Now let’s separate the two and focus specifically on transparency in active ETFs.
Before we dive in, let’s define what separates active and passive ETFs. Active ETFs are funds in which a portfolio manager is making deliberate decisions about what to buy and sell, rather than simply tracking an index like their passive counterparts. That intentionality usually comes in the form of proprietary research and the end goal of outperforming a specific benchmark.
Actively managed ETFs have grown dramatically in popularity. Indeed, investment management giant BlackRock has projected that global active ETF assets under management will triple to $4.2 trillion by 2030, from $1.4 trillion as of June 2025.4 But with active management comes an important question: how do you know the manager is doing what they say they're doing?
That's exactly why transparency is so important when looking at active ETFs. With an index fund, the strategy is mechanical and predictable. With an active fund, investors are trusting a portfolio manager and/or investment team to make good decisions. Examining the holdings makes it possible for investors to verify that the strategy they signed up for is the strategy being executed.
And that’s exactly what we’ve done. For the Motley Fool Small-Cap Growth ETF (TMFS), one of our actively managed ETFs, for example, we publish a list of its holdings daily.
The takeaway
Knowing what you own isn’t just a feature that’s nice to have. It's a prerequisite for building a portfolio that's aligned with your goals, your risk tolerance, and your time horizon. ETF transparency is one of the core features that make these funds such a powerful tool for long-term investors.
Ready to see what transparent, active investing can look like? Explore our funds and see exactly what's inside.
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