The
The SEC, which is working in tandem with the
Transaction costs, which include the commissions paid to brokers as well as the difference between the price to buy and sell securities, are rarely made known to investors. Turnover rates, in particular, are only mentioned in a supplementary report to the fund's prospectus available only upon request.
The proposal is part of a broader effort by the SEC to determine whether mutual funds should be required to provide more information to investors. Among the many things that the SEC task force is working on are recommendations on disclosure of soft-dollar payments.
In the first quarter, the Commission will also be looking to enforce a redemption-fee plan, which would levy fines on early withdrawal in order to curtail abusive market timing practices. Another measure will ensure that the 4 p.m. deadline for trading is strictly enforced, preventing investors who place trade orders after the market closes from receiving that day's price.