The Securities and Exchange Commission announced Wednesday that it has adopted amendments to reporting requirements which it says will provide more timely information about certain registered investment companies.
But there could be negative impacts according to the Investment Companies Institute.
Requirements to file Form N-PORT - which includes information about a fund’s portfolio holdings and related information to help assess a fund’s risks – on a monthly rather than quarterly basis will apply mostly to registered open-end funds, registered closed-end funds, and ETFs organized as unit investment trusts.
The SEC said that the change will “promote more effective regulatory monitoring and oversight of the fund industry for the benefit of fund investors.”
“Reliable, accessible data benefits everyone,” said SEC Chair Gary Gensler. “These amendments will benefit investors through greater transparency of funds’ investment portfolios and improve the Commission’s oversight of the asset management industry.”
However, ICI president and CEO Eric Pan responded to the news, highlighting that the Institute has raised “serious concerns” about moving portfolio holdings disclosure on Form N-PORT from quarterly to monthly.
“This will open fund managers to a greater risk of predatory trading that will harm fund shareholders, without any corresponding benefit,” he warned. “ICI has also questioned the SEC’s requirement to have funds file these holdings within 30 days of month end given the volume of information required and the SEC’s history of data security breaches. Additionally, the Commission continues to give little consideration to the disproportionate burden of its rulemaking on smaller fund complexes. The SEC should have reproposed the new reporting requirements to ensure adequate public comment on these concerns.”
The SEC also announced that it has adopted reporting amendments related to open-end fund liquidity risk management program requirements.
This will require open-end funds “to report certain information about service providers used to fulfill liquidity risk management program requirements so that the Commission can track certain liquidity risk management practices,” the SEC said.
“We also will review today’s new liquidity risk management program guidance to understand how it will impact funds and their shareholders,” the ICI’s Pan responded. “It is important to note that funds currently have robust liquidity risk management programs as a matter of practice and existing regulatory requirements.”
Big-name defections from Morgan Stanley, UBS, and Merrill Lynch headline a busy two weeks of recruiting for the wirehouse.
Markets have always been unpredictable. What has changed is the amount of information investors are trying to process and the growing role advisors play in helping clients avoid emotional decisions
Six apartment deals, one "big account," and $2.7M in undocumented insider loans. Now the lawsuit lands
The Illinois order refers to Brandon Ellington’s investment program as a “Ponzi-like scheme.”
But the Amazon executive chair seems to want it both ways, arguing that taxing the ultra-wealthy won't help struggling Americans.
As technical expertise becomes increasingly commoditized, advisors who can integrate strategy, relationships, and specialized expertise into a cohesive client experience will define the next era of wealth management
Growth may get the headlines, but in my experience, longevity is earned through structure, culture, and discipline
