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Researchers Suggest Zoning System to Address High-Frequency Concerns
The white paper On the Impact and Future of HFT examines the attitudes of various market participants toward high frequency trading, “imminent problems and risks of HFT,” and possible solutions to...
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Valuation Guidance Embedded in Money Market Fund Release
In the recent 893-page money market fund release (“Release”), the SEC weighed in with valuation guidance for short-term debt securities and thinly-traded holdings. While it was not the stand-alone...
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Mutual Fund Rules Under Development to Address Risk in Asset Management
As the FSOC continues its focus on the asset management industry – potentially changing its focus from individual asset management to the activities and products offered by asset managements – the SEC...
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Consumer Group Pushes for Market Structure Action
The Consumer Federation of America, a non-profit consumer advocacy group, recently issued a white paper entitled Toward A U.S. Equity Market Structure That Serves All Investors. The paper argues that...
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SEC Distribution Fee Analysis Expected This Year
The SEC will wrap up its analysis of distribution-related payments by the end of the year, according to a recent report by Reuters. In March 2013, the agency announced that it would conduct a sweep of...
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Tradebot CEO Criticizes Tick Size Pilot
The SEC’s tick pilot program will do more harm than good, according to Dave Cummings, CEO and Chairman of Tradebot Systems and founder and former CEO of BATS Trading, the second-largest exchange in...
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Champ Cautions Hedge Fund Advisers in Alts Space
In a recent speech focused on hedge funds the Director of the SEC’s Division of Investment Management, Norm Champ, addressed alternative mutual funds. He explained that his focus on the area was due...
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Gallagher Calls for Holistic Review of Markets, Warns of Fixed Income Risks
SEC Commissioner Dan Gallagher called for a holistic review of equity market structure in a speech earlier this week. Gallagher suggested a de novo review for certain regulations, including Reg NMS, a...
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SEC Chair Advocates for Female Board Members
SEC Chair Mary Jo White stressed the importance of boardroom diversity in a recent speech, specifically focusing on the need for female representation. White discussed her personal background and...
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GAO Finds FSOC Processes Still Need Work
The Government Accountability Office (GAO) advocated for greater FSOC transparency in a report released last week (“Report”). The report examined the FSOC’s progress on GAO recommendations issued in...
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Fund Scalability Research Offers Insights on Mergers
In a recent paper, a researcher from the University of Arizona examined funds before and after mergers in an attempt to study the effect of scale on performance. The paper, entitled Do Mutual Funds...
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Blackrock Suggests Fixes to Fixed Income Troubles
A new whitepaper issued by Blackrock argues that the secondary market for corporate bonds is “broken,” but that “current environment of low interest rates and low volatility, coupled with the positive...
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Mutual Funds Lose to Short Sellers
A new study finds that “a significant element in the profitability of [short selling] is derived from predictability in [mutual fund] trading patterns.” The researchers used daily trading data and...
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PIMCO Bond Valuation Under SEC Scrutiny
The SEC has taken interest in PIMCO’s valuation process in its Total Return ETF, according to The Wall Street Journal. The Journal reports that the SEC’s focus is on odd-lot bonds purchased at a...
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Researchers Find Investors Don’t Sufficiently Account For Volatility in Fund...
A recent study found that investors flock to volatile performance in the selection of fund managers. A group of academics performed three surveys, asking German “financially competent private...
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SEC Staff Studies Small Cap Market Quality
A new study from SEC staff examines market quality in small cap stocks. The study, A Characterization of Market Quality For Small Capitalization US Equities, reviewed quoting data for each trading day...
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FSOC Releases FAQ on Nonbank Designation
The Financial Stability Oversight Council last week posted a new set of frequently asked questions concerning the nonbank designation process. The 22 questions and answers cover a wide range of...
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Judge Dismisses Challenge to Pay-to-Play Rule
A district court judge dismissed a challenge to the SEC’s Political Contribution Rule (better known as the “Pay-to-Play” rule) on jurisdictional grounds. The rule, adopted in 2010 by a unanimous...
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Federal Reserve Imposes Cap on Reverse Repo Facility, Rate Falls to Zero
The Federal Reserve limited its reverse repo facility to $300 billion per day as of September 22 in order to address concerns that a facility of unlimited size could worsen issues during periods of...
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Commissioner Piwowar Discusses Uniform Fiduciary Duty, Useful Disclosure
In a recent speech, SEC Commissioner Michael Piwowar questioned the utility of requiring a uniform fiduciary duty for broker-dealers and investment advisers. Piwowar worried that, similar to what has...
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