Mutual Fund Performance Fees: Perspectives After More Than 40 Years
In 1972, the US Securities and Exchange Commission (SEC) published several releases and adopted rules relating to mutual fund performance fee arrangements. In the early 2000s, SEC Staff sweep examinations related to fund performance fees and the resulting SEC enforcement actions suggested that the law governing mutual fund fulcrum fee arrangements was unclear in many respects. More than 40 years later, there has been a renewed interest in performance fees by SEC Commissioners, some fund investment advisers, rating agencies and journalists. In particular, interest in performance fee arrangements for actively managed funds has increased as a way to compete with passive funds. This renewed interest brings into focus once again the regulation of these arrangements.
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