In June, the Securities and Exchange Commission (SEC) adopted new public liquidity-related disclosure requirements for several open-end funds. These disclosure changes would now require funds to disclose, in either their annual or semi-annual shareholder report, the operations and effectiveness of their liquidity risk management programs.
These amendments would replace the current pending requirement that funds provide a quantitative description of past aggregate liquidity classification data on Form N-PORT. Form N-PORT is the form that funds file monthly along with portfolio holdings information.
These amendments are designed to give investors useful information about the liquidity risk management practices of all the funds that they hold. It is important to disclose information, particularly in regards to the effectiveness of liquidity risk management programs, so investors can be knowledgeable about their holdings and finances.
The amendments also allow funds the option to split their portfolio holdings into multiple classification categories on Form N-PORT to more accurately reflect the liquidity of the investment. The new amendments put forth three specific circumstances designed to better reflect the liquidity of an investment or ease cost burdens. The circumstances are: full liquidation, differences in liquidity characteristics, and differences in sub-adviser classifications.
Colonial Filings can help with all of your N-Port SEC filing and disclosure needs. Contact us to learn more!