Sat, Dec 5, 2020
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Other Voices: SEC updates regs for funds of funds, but some limitations remain

Thursday, October 22, 2020

By: Scott Moss, Lauren A. Schwartz, Lowenstein Sandler

On October 7, 2020, the Securities and Exchange Commission (SEC) voted to adopt rule 12d1-4 under the Investment Company Act of 1940 and related amendments to streamline and enhance the regulatory framework, which governs registered funds that invest in other investment companies and private funds that invest in other registered funds ("fund of funds" arrangements). The SEC is also rescinding rule 12d1-2 and most exemptive orders granting relief from sections 12(d)(1)(A), (B), (C), and (G) of the 1940 Act and adopting related amendments to rule 12d1-1 under the 1940 Act and Form N-CEN.

I. Current Regulatory Framework

Section 12(d)(1) of the 1940 Act limits a registered fund's investments in other investment companies and a private fund's investments in registered funds. Section 12(d)(1)(A) proscribes a registered fund (and companies, including funds, it controls) (the "acquiring fund") from acquiring more than 3 percent of another investment company's (the "acquired fund") outstanding voting securities, investing more than 5 percent of its total assets in any one acquired fund, or investing more than 10 percent of its total assets in an acquired fund and other investment companies generally.

These limits apply to both registered and unregistered investment companies with respect to their investments in a registered investment company. These limitations also apply to registered investment companies' ......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Renaissance, Two Sigma see losses as quant giants navigate chaos, Hedge fund run by BofA veterans trounces 99% of Brazil peers, Amid a tough year, CQS makes changes - and sees a rebound[more]

    Renaissance, Two Sigma see losses as quant giants navigate chaos From Bloomberg: Two of the hedge fund industry's quantitative powerhouses are getting tripped up this year as wild markets throw off their investing models. Renaissance Technologies, which manages the world's biggest q

  2. Investing: Hedge funds bet on tech ahead of unpredictable fourth quarter, The Tiger crowd's fresh buys, raises Uber stake, David Einhorn adds Twitter and Intel shares, keeps big bets on inflation, Palantir stock rockets to record highs as hedge funds disclose stakes, Trian dumped GE stock, but Druckenmiller stood pat in Q3 as SEC probe heated up[more]

    Hedge funds bet on tech ahead of unpredictable fourth quarter From Bloomberg: Hedge funds mostly stuck with the safety of technology stocks during the third quarter as they headed toward the uncertainty of this month's U.S. election. If they're still holding on to those wagers, it will

  3. SPACs: As Ackman hunts blockbuster deal, he counts on big backers[more]

    From Reuters: Hedge fund veteran William Ackman has the support of some of Wall Street's top investors as he tries to pull off the biggest-ever deal carried out by a blank-check acquisition company, according to regulatory filings published in the last few days. Among the heavy hitters rounded u

  4. Bill Ackman is bullish on stocks for 2021, but has a hedge position for a 'tragic' end to 2020[more]

    From CNBC: Billionaire hedge fund manager Bill Ackman, who made big money betting against the markets earlier this year, said he's optimistic about a recovery in 2021, but investors will need to get through a "tragic" year-end first. "We think the next couple of months unfortunately are going to

  5. SPACs: Media, energy-focused SPACs raise $561m in market debuts[more]

    From Law 360: Two blank-check companies, one led by former Disney executives and the other backed by Apollo Global Management, started trading Wednesday after raising a combined $561 million in initial public offerings. Forest Road Acquisition Corp. raised $261 million in its upsized debut, wh