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Bailey McCann, Opalesque New York: Hedge funds and providers of liquid alternatives will want to pay close attention to proposed reforms approved by the SEC yesterday. The changes will require more frequent reporting, as well as a closer look into social media, liquid alternative strategies, and branch offices. The Commission says the changes will "enhance the quality of information available to investors and would allow the Commission to more effectively collect and use data provided by investment companies and investment advisers."
The changes add to the reporting required by registered investment companies, mutual funds and ETFs. The proposals would require a new monthly portfolio reporting form (Form N-PORT) and a new annual reporting form (Form N-CEN) that would require census-type information. The Commission is also structuring and standardizing how that information is reported to make it easier to understand by both regulators and investors.
Speaking on the proposed changes, Commissioner Kara M. Stein touched on the shift toward liquid alternatives. "Mutual funds have increasingly pushed into strategies and asset classes that the Commission’s current reporting forms were not designed for. The Investment Company Reporting Modernization Proposal recognizes this gap and requires, for the first time, standardized information on derivatives, detailed counterparty exposures, and portfolio level risk metrics. This updated information should help the Commission ke...................... To view our full article Click here
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