SEC Staff Issues Liquidity Rule Frequently Asked Questions

February 16, 2018

The Staff of the U.S. Securities and Exchange Commission’s (SEC) Division of Investment Management has published a first set of responses to frequently asked questions (FAQs) regarding Rule 22e-4 under the U.S. Investment Company Act of 1940 (1940 Act) (Liquidity Rule). The FAQs provide guidance on: (1) the manner in which responsibilities under a fund’s liquidity risk management program may be delegated to third parties, including to a fund’s sub-adviser; and (2) the definition of an “in-kind” exchange-traded fund (In-Kind ETF).

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