Fund Investors May Pay Fees for Withdrawals Amid Turmoil
This article is for subscribers only.
Mutual funds may be able to charge their investors who rush to cash out during periods of market stress under a rule being considered by the U.S. Securities and Exchange Commission.
Officials at the regulator think the change could curb the impulse to stampede out of mutual funds when asset prices are at risk of tanking, according to two people familiar with the matter who asked to not be named. The measure, which is part of a broader rule proposal scheduled for a Sept. 22 vote, could help funds cope with shocks such as a central bank’s move to hike interest rates that could prompt widespread investor withdrawals.