The Securities and Exchange Commission Thursday approved a new rule to combat market timing that would leave the decision to impose redemption fees on mutual funds up to the board of directors and allow funds to hold intermediaries more accountable for abusive trading.

In a unanimous decision, all five SEC commissioners voted to approve a more flexible version of a proposal floated last year that sought to stamp out rapid short-term trading. The original proposal called for funds to impose a mandatory 2% redemption fee on shares sold within five days of purchase. According to the Commission, 85% of the 400 comment letters it received opposed mandatory redemption fees.

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