US mutual fund swing pricing proposal what can we learn from Europe?

The article The SEC's Liquidity Risk Management Proposal, in this issue, discusses the Securities and Exchange Commission's (SEC) continued focus on modernizing and strengthening the regulation of US mutual funds by proposing rules that would require mutual funds and exchange-traded funds...

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Bibliographic Details
Published in:The Investment Lawyer 2016-01, Vol.23 (1), p.32
Main Authors: Ponchione, Marc, Solander, David, Arbaut, Yannick, Graas, Renaud
Format: Article
Language:English
Subjects:
Amendments
Costs
Investment policy
Liquidity
Mutual funds
Proposals
Purchasing
Regulatory agencies
Risk management
Stockholders
Subscriptions
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Summary:The article The SEC's Liquidity Risk Management Proposal, in this issue, discusses the Securities and Exchange Commission's (SEC) continued focus on modernizing and strengthening the regulation of US mutual funds by proposing rules that would require mutual funds and exchange-traded funds to adopt liquidity risk management policies and procedures and permit, under certain circumstances, a mutual fund to use "swing pricing" to vary its share price in order to pass the cost of portfolio changes due to purchase and redemption activity to those investors associated with the activity. This article focuses on the second proposal, the adoption of swing pricing for US mutual funds, which could represent a dramatic regulatory change in US mutual fund operations. Proposed amendments to rule 22c-1 under the Investment Company Act of 1940 (1940 Act) would permit the use of swing pricing (the Swing Pricing Rule) by SEC-registered open-end investment companies, or mutual funds.
ISSN:1075-4512