State Street Corp. seemed to perfectly time the private-markets wave, debuting a private credit exchange-traded fund in February months ahead of an executive order that aimed to push more investors into alternative assets.

It had a coveted ticker: PRIV. It had a blue-chip partner: Apollo Global Management Inc. And it had a straightforward goal: “democratizing access” to investment-grade private credit.

In less than a year, though, the fund has faced scrutiny from the US Securities and Exchange Commission and struggled to attract money. What’s more, the ETF is mostly not actually invested in private credit: The vehicle’s documents acknowledge such debt will generally make up between 10% to 35% of the fund. Its top three holdings are an agency mortgage bond and two US Treasury notes.

The challenges, even for the third-largest ETF issuer State Street, make it something of a cautionary tale for those seeking to push retail investors into private markets. At a minimum, it suggests the so-called liquidity mismatch between private assets and ETFs, which price on a second-by-second basis, may be too much to overcome, threatening to close off private markets to one of the most popular ways to invest.

“Just because they figured out the legalese of everything doesn’t mean that people care about it or want it,” said Sam Huszczo, founder of SGH Wealth Management. “It’s more about selling product and trying to solve this late cycle issue that private credit is in.”

Since its launch, PRIV has attracted a fraction of this year’s ETF boom, raising $45 million of the industry’s $1.5 trillion intake. This is despite the fact that the fund is outperforming its bond-market benchmark, according to data compiled by Bloomberg.