Extension of Rule 22e-4 Information Collection
AI-generated summary for informational purposes only. Not legal advice. See the original source for the authoritative text.
This notice extends the information collection for Rule 22e-4, involving the liquidity risk management program for open-end funds and ETFs. It requires funds to have a written plan to assess and manage liquidity risks, ensuring shareholder redemption rights. The rule impacts funds, exchange-traded funds, and unit investment trusts, requiring them to monitor and record liquidity positions regularly.
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Key Changes
- Funds must have a written liquidity risk management program
- Regular assessment and management of liquidity risk is required
- Limit on illiquid investments to no more than 15% of net assets
Obligations
What this law requires
Establish a written liquidity risk management program reasonably designed to assess and manage the fund's or In-Kind ETF's liquidity risk
Conduct assessment, management, and periodic review of liquidity risk no less frequently than annually
Classify the liquidity of a fund's portfolio investments and conduct at-least-monthly reviews of the fund's liquidity classifications
For funds not primarily holding highly liquid investments, determine and periodically review the fund's highly liquid investment minimum and establish policies and procedures for responding to shortfalls, including reporting to the board of directors
Limit investments in illiquid investments to no more than 15% of the fund's or In-Kind ETF's net assets