July 14, 2020
I bring to your attention the problematic nature of the proposal to change the Reporting Threshold for Institutional Investment Managers.
Under the current reporting guidelines there is a glimpse of transparency which makes our Exchanges extraordinarily open to investors of all sizes, failing to continue operating in the way all investors have access to this information directly impacts the freedom of the market, it is difficult enough to compete in this market with companies that have access to more information and capital than small investors, coupled that inequity with diminished information on where companies under that threshold are operating and the activities they are conducting and you will find greater inequity and lack of transparency.
Driebusch and Ching (2020) have stated that nearly 90 percent of current filers would end such disclosures of 13Fs.
I would probe the causes of such move by the SEC and whether there is a correlation with easier access to these Exchanges by the average American, where he/she no longer has to rely on an investment firm or paid trading accounts to invest in the market. This may very well be a plain conjecture, however, the timing of your proposal festers the average American, furthermore, the argument that this move is simply to proportionately reflect current market values is unconvincing and shamefully absurd, a firm managing funds upwards of $100 million can certainly and without a doubt afford a filing fee and compliance costs of $30,000 annually, being a infinitesimal fraction of the entire portfolio, moreover, the proceeds received from fees and penalties by the SEC ought to be utilized to increase 13F compliance and accuracy.
I hope that the SEC reconsiders its position on this topic and discards the idea to increase the reporting threshold merely to appease institutions with portfolios less than $3.5 billion.
References
Driebusch, C. and Ching, J. (2020) SEC Rule Proposal Would Slash Number of Investment Managers That Need to Report Quarterly Holdings. Retrieved from https://www.wsj.com/articles/sec-rule-proposal-would-slash-number-of-investment-managers-that-need-to-report-quarterly-holdings-11594429438?mod=searchresultspage=1pos=1