SIFMA recommends improvements to SEC

SIFMA’s Asset Management Group (SIFMA AMG) says it has submitted comments to the Securities and Exchange Commission (SEC) regarding the SEC’s proposed liquidity management rules for open-end funds, including mutual funds and exchange-traded funds (ETFs). SIFMA AMG says it submitted two comment letters: one focused on the SEC’s proposed requirements for liquidity risk management programs, and one focused on the SEC proposal to permit swing pricing on an optional basis.

“SIFMA’s Asset Management Group shares the SEC’s goal of promoting a resilient marketplace that works in the best interests of investors, and we commend the SEC for its leadership in assessing new tools that promote this objective,” said Kenneth E Bentsen, SIFMA president and CEO.  “Mutual funds, ETFs and other products are vitally important tools that help investors achieve their financial goals. As such, it is crucial that any new rules strike the right balance of promoting stability while preserving the benefits these funds bring to investors.”

Timothy W Cameron, managing director and head of SIFMA’s Asset Management Group, added: “Liquidity is a fluid and dynamic concept which cannot be measured with the exactness proposed in this rulemaking, especially for fixed income instruments and other instruments traded over the counter. Funds will, by their nature, vary in their subjective approaches to liquidity classifications. As proposed, the SEC’s liquidity risk management program, which requires objectivity, would have a detrimental impact to funds and investors. SIFMA AMG’s letters offer constructive insight on how to move these initiatives forward in a manner that best accomplishes the SEC’s goals.”