In February 2023, FINRA provided an update on its review of member broker-dealer firms’ practices for their social media practices and related privacy protection. In it, FINRA summarized practices it has observed to date to help firms evaluate whether their practices and supervisory systems are reasonably designed to address risks related to social media influencer

On November 2, 2022, the SEC proposed wide-ranging changes to how open-end investment companies (other than exchange traded funds and money market funds, “Funds”) process and price shareholder transactions and manage their corresponding liquidity risks (the “Proposal”). This post attempts to summarize key elements of the Proposal as a precursor to our analysis of its merits. “Attempts” is the apt term, as the Proposal would involve substantial revisions to multiple rules and disclosure forms, which makes organizing our summary a challenge.

I was looking for something else on the Division of Investment Management’s (Division) website the other day and ran across a study of Prime MMFs’ Asset Composition and Asset Sales (the Study) released by its Analytics Office in June. Nothing indicates why the Study was prepared, but I hope it reflects an effort by the Division to better understand how prime institutional money market funds operate and the potential consequences of the proposal to require these funds to employ “swing pricing” whenever they have net redemptions. The Study supports my conclusion that this proposal would dilute redeeming shareholders rather than preventing dilution to remaining shareholders.

In the first half of 2022, we saw significant U.S. Securities and Exchange Commission (SEC) enforcement and rulemaking activity around ESG investing, and the SEC’s intense focus in this area shows no signs of abating as we move through the third quarter. In this four-post series we:

  • Summarize the 2019-2021 ESG-related initiatives at the SEC;
  • Review the SEC’s ESG-related enforcement activity in the asset management industry;
  • Outline the SEC’s May 2022 ESG-related rule proposals for funds and advisers; and
  • Suggest factors that mutual fund boards should consider in their oversight of ESG funds and adviser ESG initiatives.

This continues my series of posts on the SEC’s proposal to require money market funds with floating net asset values (“institutional money funds”) to implement swing pricing during any pricing period in which the fund has net redemptions. In this post, I consider the effects of swinging a price too frequently.

This continues my series of posts on the SEC’s proposal to require money market funds with floating net asset values (“institutional money funds”) to implement swing pricing during any pricing period in which the fund has net redemptions. Having surveyed how institutional money funds are supposed to determine swing prices under the proposal, I am turning to when swing pricing would be required. First, I want to consider a unique feature of institutional money funds, namely that many funds calculate a floating net asset value per share (“NAV”) more than once a day. The proposed amendments would define the time from the calculation of one NAV to the next as a “pricing period.” Pricing periods pose two conflicting problems for swing pricing.

This continues my series of posts on the SEC’s proposal to require money market funds with floating net asset values (“institutional money funds”) to implement swing pricing during any pricing period in which the fund has net redemptions. Having address the estimated costs that institutional money funds must always include in their swing price, this post considers the “market impact factor” to be included when net redemptions exceed the market impact threshold. I suspect the SEC underestimated the difficulty of estimating market impact factors.