December 29, 2021
I generally like the idea of a brief shareholder report. There are a few things I think need to be changed:
1. The first item presented should be the asset class and risk profile of the fund. Fund regulatory disclosures focus first on fees. However, if an investor does not understand the risk profile of the fund, it will cost the investor far more than a few basis point in fees.
2.The cost presentation is too complicated. Just tell me the cost as a percent and in dollars. The number should reflect the fees of other investment companies.
3. Remove the liquidity risk disclosure. Mutual funds and ETFs are required to redeemable. I do not care about the under-the-hood operations to make that happen.
4. Consolidate he locations of fund information. There should be a prospectus, short annual report and then a third location for all other fund information required by the SEC. It should not be spread across several lengthy documents.
5. Combine the shareholder report with the prospectus. This can be done by adding fund statistics, narrative discussion of performance and a graphical representation of holdings (or top holdings) to the fund summary prospectus.