August 17, 2020
This new proposal seems to conclude that managers with 100 million dollars in AUM do not have as much influence on market volatility as managers that have 35 times that amount in AUM. If this were in fact the case, we should first determine how an trader with less than 50 mill AUM could have caused a market wide flash crash in 2010.
From my direct experience in trading and investing, I believe that total AUM matters less than how quickly assets are acquired or turned over in a portfolio. I.e. funds with high turn over ratios can affect market prices on an extreme level, and for an extended period of time beyond their holding period, compared to multi billion dollar asset managers that have long-term (e.g. 1 year or more) holding periods.
Its my belief that this new proposal will be a great disservice to the transparency, confidence, longterm stability of exchange listed investment vehicles.