Third Avenue Bust Won't Keep Funds From Fighting SEC Safeguards
- Vanguard opposed to disclosing time needed to sell assets
- ICI says agency's cash cushion requirement is misguided
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The failure of a high-yield bond fund at Third Avenue Management LLC isn’t stopping financial firms like Vanguard Group Inc. from arguing that the mutual fund industry doesn’t need a slew of new regulations to protect investors during market routs.
The industry’s regulator, the U.S. Securities and Exchange Commission, proposed requirements in September to ensure funds have more easy to sell assets to meet withdrawals amid turmoil. The worst fears of regulators were realized last month when Third Avenue blocked clients from pulling their money from a $788.5 million fund because it couldn’t meet redemptions without selling holdings at steep discounts.