SEC Proposes That Bond Funds Disclose Risk of Interest Rate Rise
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Bond funds would have to report how vulnerable their holdings are to interest-rate changes under a rule proposed Wednesday by the Securities and Exchange Commission.
The five-member SEC unanimously voted to seek comment on the plan, which would require mutual funds to disclose more about their exposure to derivatives, repurchase agreements, and securities lending. For bond funds, the reports would include a metric known as duration that shows how their bond holdings would perform if rates were to rise by 1 percentage point.