Mutual Funds Begin Providing Interactive Data

by Philip Morton, Investors Offshore

22 August 2007

US Securities and Exchange Commission Chairman Christopher Cox announced on Tuesday that several mutual funds have begun providing risk/return information using interactive data, representing a significant step in the Commission's ongoing efforts to make financial data more useful and understandable for investors.

"Millions of retail investors rely on mutual funds to finance their retirement, health care, education, and other financial needs, so shopping for the right fund shouldn't be a needlessly time-consuming and frustrating exercise," explained Chairman Cox.

"When most mutual funds provide their risk/return summary information using dynamic data that's searchable and comparable on the Web, investors will be able to comparison shop among thousands of funds at the click of a mouse. This is a potentially rich new source of investing information for retail investors who need it most."

"We commend the mutual funds that have demonstrated their commitment to investors by leading the way to interactive data," Chairman Cox added.

The Commission voted unanimously on June 20, 2007, to adopt final rule amendments that would enable mutual funds to submit risk/return summary information from their prospectuses using interactive data. The risk/return summary at the front of every mutual fund prospectus includes information about a fund's investment objectives and strategies, risks, costs, and historical performance.

All of the new, interactive mutual fund data will be made available to the public on the SEC's online database, named EDGAR, and to subscribers of EDGAR's high-speed data dissemination service. The Commission will monitor how the data can be used to help inform mutual fund investors, and will consider whether further steps are necessary to increase accessibility.

Among the first mutual fund filers to participate in the expanded voluntary program are the Allegiant Advantage Fund, American Funds' Europacific Growth Fund, Muhlenkamp Fund, and Vanguard 500 Index Fund. The SEC is encouraging additional filers to participate.

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