Mutual funds may have to overhaul part of their pricing models in a way that makes it costlier for investors to redeem shares during times of extreme market tumult.
The US Securities and Exchange Commission proposed making investment companies use a new “swing pricing” mechanism to spare long-term mutual fund investors from bearing the cost of large buy and sell orders that drive share-price changes. The requirements could bolster the market in times of extreme volatility like the one brought on by the onset of the Covid-19 pandemic in March 2020, according to the regulator.
“In times of stress, when ...
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