SEC Review Could Lead To Slowdown In ETF Trading

Law360, New York (October 19, 2011, 7:28 PM EDT) -- A U.S. Securities and Exchange Commission review of exchange-traded funds announced Wednesday could result in new trading restrictions on the controversial financial instruments that critics claim lead to wild market swings and harm mainstream investors, attorneys say.

At a Wednesday hearing before a Senate Banking Committee panel, Eileen Rominger, director of the SEC's Division of Investment Management, confirmed that the agency had opened a general review into how ETFs affect securities markets.

Commission staff are looking at “the adequacy of investor disclosure, liquidity levels and transparency...
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