Bridge over ocean
1 May 2004 Financial Analysts Journal Volume 60, Issue 3

Protecting Fund Shareholders from Costly Share Trading

  1. Gary L. Gastineau

In the wake of revelations that many mutual funds have not protected fund shareholders from abuse by late traders and market timers, the emphasis of most regulators and pundits has been on strengthening compliance. But although stopping abuses is important, most of the abuses cited are possible only because the standard mutual fund pricing and trading processes are inherently flawed. Most fund share trades that arrive late in the day are costly to existing fund shareholders whether the trades were initiated by short-term traders or by other investors. Investors and regulators need to understand how costly the current trading and pricing processes are and how to fix the problems.

Read the Complete Article in Financial Analysts Journal Financial Analysts Journal CFA Institute Member Content

We’re using cookies, but you can turn them off in Privacy Settings.  Otherwise, you are agreeing to our use of cookies.  Accepting cookies does not mean that we are collecting personal data. Learn more in our Privacy Policy.