Subject: File No. s7-12-18
From: Tom Arnold

June 23, 2018


1. How do you pick funds? What information do you want to know when you make an investment in a fund? What publications or websites do you review? What tools, online or otherwise, do you use? Do you look at the SECs website?
I want to know the manager, the investment strategy, expenses, maximum historic drawdown and fund size. For active strategies, performance history vs. benchmark. For asset classes, correlations with other major asset classes. The best source of information is Morningstar, but Yahoo is good too if you know where to look for info. I wouldnt dream of consulting the SEC website.

2. Do you read current fund disclosure documents? Do you understand them? Is there information you do not receive from the fund that you would like to get?
They are just boilerplate. I occasionally look up the expense table, but otherwise a legal (not informative) document.

3. How well do current fund disclosures (such as a summary prospectus, prospectus, or shareholder report) help you pick an investment? Is it easy to compare different funds? Are there technology-based tools that could make fund comparisons easier? What helpful features do those tools have?
They dont, except that the provide data scraped by providers like Morningstar to populate their sites. Its far easier to compare funds on Yahoo or Morningstar, which select relevant information, than wade through SEC-mandated documents.

4. Do you use the advice of a financial professional? Does a financial professional's help affect whether and how you use fund disclosures?
There is no way I would take advice from most of the financial professionals I know.


5. How do you prefer to receive communications about fund investments? For example, do you prefer mail delivery, email, website availability, mobile applications, or a combination?
Website availability is fine. I occasionally look at iShares or Vanguards mobile apps, but theyre only a useful shortcut. I throw away any mail and have learned to ignore email from fund managers.

6. What types of fund information do you prefer to access electronically? What types of fund information do you prefer to receive in paper? Are there other wayssuch as by video or audio, you would like to receive fund information?
Websites work

7. How can the SEC better use technology and communication tools to help investors focus on important fund information?
Stop mandating reams of useless paper that any sensible investor ignores


8. Is there too much technical writing in fund disclosure? Would you prefer more tables, charts, and graphs? Would these graphic displayes be in addition to, or in place of, text-heavy disclosures?
Dont care between texts or graphs. Its the level of absurd minutiae thats excruciating, however its presented.

9. Do you prefer to receive shorter 'Summary' disclosures, with additional information available online or upon request?
Shorter is better.

10. Should fund disclosures be more personalized? For example, should disclosures show the amount of fees you paid or your actual investment returns? If so, how?
No, its too complicated.


11. Do fund disclosures make the fund's strategies and the level of risk clear? How can funds improve these disclosures? Would a risk rating, such as a numerical or graphical measure of risk, be helpful?
I personally dont find it helpful, but a risk rating such as the ones on Vanguards website might help some investors. I personally find it simplistic and overly conservative.

12. Fund fees and expenses can significantly affect a fund's investment returns over time. Do you think funds clearly disclose their fees and expenses? How could funds improve the disclosure of fees and expenses? Would a comparison of your funds fees against other funds fees help?
A graphic illustration of how expenses compare to other funds with the same benchmark would be a shortcut. It should include, not exclude, index funds.

One problem with illustrating costs is the SECs mandated expense disclosure for ETFs is horrible. Doesnt capture externalized trading costs.

13. Do you consider the past performance of a fund when making an investment decision? How could we improve the presentation of performance information?
Yes, but only to get a sense of correlation with benchmark and risk of strategy. Would be beneficial to have funds report some measure of average benchmark deviation (active risk).


14. Aside from this questionnaire, are there other ways the SEC can engage with investors, like you, on key topics? Is there anything else you would like to tell us?