Leadership and Companies
SEC Proposal Would Reopen Most Fixed-Income Cross-Trades for Funds
The SEC proposed expanding registered funds’ ability to cross-trade fixed-income securities with affiliates under stronger safeguards.
What happened
The SEC proposed amendments to Rule 17a-7 that would restore registered funds’ ability to cross-trade most fixed-income securities with certain affiliates. The proposal would update pricing and oversight requirements, reflecting more transparent and verifiable market pricing. Funds engaging in cross-trading would also have to report their activity in aggregate, while the comment period would remain open for 60 days after Federal Register publication.
Why it matters
The changes could reduce open-market trading costs for funds and pass those savings to investors, while added reporting and oversight provide greater transparency.
Source: U.S. SEC Press Releases