The U.S. Securities and Exchange Commission is initiating a study of financial literacy and investor disclosure issues.
The SEC, which is mandated to carry out the research by the Dodd-Frank reform effort, is to examine retail investors’ financial literacy and submit its findings to Congress by July 21. Along with its own qualitative and quantitative research, including investor testing, the SEC is also seeking public comment on financial literacy and investor disclosure issues.
Specifically, it’s seeking comment on methods to improve the timing, content, and format of disclosures to investors concerning financial intermediaries, investment products and services. It’s also requesting comment on the sort of information that retail investors need to make informed decisions on hiring a financial intermediary, or purchasing an investment product or service typically sold to retail investors, including mutual funds. Additionally, the SEC is seeking comment on how to make investment expenses and conflicts of interest in investment transactions more transparent to investors.
“Many of the issues that the Dodd-Frank Act identified for commission study directly affect individual investors. As a result, we are especially interested in receiving comments from individual retail investors,” said Lori Schock, director of the SEC’s Office of Investor Education and Advocacy.
The public comment period will be for 60 days.