February 2, 2004
Disclosure Regarding Market Timing and Selective Disclosure of Portfolio Holdings
Concerning the above bill, 60 days or even 30 or 15 days is too long to curb the type of violations in which you and the fund companies are most interested, whether the offenders are fund managers or individual investors doing in-and-out trading. A time period of 3 to 5 days is appropriate to curb rapid in and out trading, with a maximum acceptable of about 12 days. A fee of more like 1% is more fair than 2%, but the fee is not as important as the time period.
I do trade mutual funds several times a year, but I do not believe this should fall under the purview of your bill, since I'm not trading in-and-out (as you put it) every day. I only trade when it is appropriate to do so.
I am voicing my opposition to this bill and request that it not be passed in its current context. For us traders who trade on occasion, this bill will adversely affect our ability to trade when we feel it is appropriate without having to absorb an extremely high fee in the process. Thanks for your time.