Fee disclosures

The regulator’s expanding number of share-class cases fill in the details it says have been missing from Form ADV disclosures about conflicts of interest.

In a little-noticed rule change, mutual funds no longer disclose their shrinking BD commission load-sharing payments.

Since this March, almost 100 firms have settled with the regulator for approximately $173 million. Other cases are still pending.

More than 70% of U.S. ETF assets are in funds that charge 2 basis points or less, data show. But free isn’t an automatic ticket to success.

The indexing giant’s pilot Digital Advisor will be priced at 15 basis points, but allocate client assets almost entirely in proprietary funds.

Alternative compensation structures may provide more consumer protection, and drive higher client satisfaction.

The SEC’s 564-page rule shows the new disclosure could prove time-consuming, even vexing, for firms.

The transition is expected to take place within the next 12 to 18 months, however the firm says it will still manage the products’ underlying investments.

The firm’s complicated relationship with these fees is indicative of the industry’s overall struggle to find a balance between appropriate compensation and transparency.

An unprecedented 58 funds were closed in the six months through June, marking the industry’s worst-ever start to a year.