WASHINGTON—The Securities and Exchange Commission says it is continuing work on two studies related to providing investors with disclosures that are more useful.
Eileen Rominger, director of the SEC Invest Management Division, said as the keynote speaker at an insurance conference that the SEC is conducting investor testing to examine the effectiveness of mutual fund shareholder reports in communicating useful information to individual investors.
The study is designed to gather feedback from investors in order to help us determine how mutual fund shareholder reports could more effectively communicate information to individual investors.
The study also will generate a baseline assessment of mutual fund shareholder reports, providing a way to measure potential improvements over time.
The agency is also conducting a separate regarding financial literacy among investors that is mandated by the Dodd-Frank Act, and is also working on variable summary prospectus.
Rominger said the financial literacy study is required to address general issues regarding financial literacy of retail investors, as well as to identify “the most effective existing private and public efforts to educate investors.”
The issue should be important to agents, broker-dealers and advisors because of a separate DFA provision which expressly authorizes the SEC to designate information to be provided by a broker or dealer to a retail investor before the purchase of an investment product or service — that is, at the point of sale.
“Specifically, I hope that the study will be useful to the SEC in considering any potential rulemaking with respect to point of sale disclosure for investment products and services, including variable insurance products,” she said.