The US SEC is poised to demand monthly reports on mutual fund holdings by Reuters

WASHINGTON (Reuters) – Wall Street’s top regulator is set to approve new rule changes on Wednesday that require mutual funds and exchange-traded funds to report portfolio holdings monthly rather than four times a year, bringing greater transparency to investors, officials said. .

The five-member US Securities and Exchange Commission is scheduled to hold a public hearing at 10 a.m. Wednesday. However, in a retreat from earlier plans, the agency will not consider more substantial proposed “swing pricing” regulations that have faced strong industry opposition.

Instead, the SEC is to limit the guidance to complying with existing, related regulations governing how “open-end” funds manage liquidity risk, SEC officials told reporters before the vote. In such funds, investors can redeem their shares daily.

The swing pricing proposal sought to help open-end funds better withstand market stress, such as those seen at the start of the coronavirus pandemic, by shifting the costs of rushed redemptions to those who cash out rather than to those who remain in the fund. The agency revealed last month that it expects to redraft the proposal.

Under current reporting rules, registered investment management companies are required to file quarterly reports on portfolio holdings with the commission 60 days after the end of each quarter. But investors only have access to data covering the third month of the quarter.

Under rule changes to be considered Wednesday, the same funds would be required to file those reports within 30 days of the end of each month, with each such report becoming public after another 30 days.

Improved transparency will help investors make decisions and promote third-party analysis, according to the SEC.

If passed, the regulations would take effect in November next year or May 2026 for funds with net assets of $1 billion or less.

The guidance to be considered Wednesday will also address questions and concerns the agency has become aware of through its outreach and monitoring of the markets, SEC officials said.

These include how often open-end funds rank their asset liquidity, meaning how easily they can be sold for cash, the meaning of the word “cash” as used in the regulation, and revisions to the minimums required for highly liquid investments.