February 14, 2008
This reduction in legalese is a great idea. I also strongly encourage the SEC to stick to its guns on the issue of comparative costs. The whole point of this effort and others like it is to increase transparency and make it easier for the average consumer to quickly read, and understand the benefits, risks, costs and comparative analysis of these issues. I think I am an average consumer. I was smart enough to make it thru law school and I am smart enough to run a small family company. but the legalese and shell games found in fund company prospectus's are more then I can grasp. It should be a simple process to view and understand how the costs of a particular investment compares to like or similiar investments. any fund afraid to illustrate these costs in relation to others is simply trying to take advantage of a consumer who doesnt have the time or ability to make such a comparison.
The rise of the internet and financial company websites makes it very easy to purchase a stock or mutual fund. The companies who push these stocks and funds should have a duty to the public and the average consumer to show them what their costs are in relation to industry averages and industry highs and lows. If a fund has to hide its comparative costs to get someone to invest in it, it is not deserving of public trust. If the SEC won't protect the public's trust, who will? Don't let the special interests within the industry avoid the transparency essential to an fully informed public.