The SEC will now require mutual funds and ETF funds to report portfolio holdings every month rather than four times a year. The regulator approved the new rule change effective Wednesday.
In a public meeting, the five-person Commission voted 3-2 to approve the measures along party lines. Officials feel the move will bring greater transparency to investors. SEC Chair Gary Gensler says more frequent reporting would help investors monitor their ETF holdings and identify overlapping investments. Furthermore, the move gives the SEC greater visibility in identifying trends and responding during market stress. Amid the popularity of exchange-traded funds backed by cryptocurrency, the move is a game changer for transparency concerns.
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“Lest we need any reminders, the past few years have brought disruptions in markets, reacting to the start of COVID-19, wars abroad, and major bank failures,” Gensler said Wednesday.
The new amendments rule that funds will be required to file their portfolio holdings reports within 30 days of the end of each month. Each such report will now become public after 30 days, quicker than the initial quarterly format. If the rule changes take effect, they would do so in November next year, or May of 2026 for funds with net assets of $1 billion or less.