SEC's New Investor Advisor Committee Focuses On Investor Needs Rather Than Fiducairy Status Of Intermediaries Hot

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An Investor Advisory Committee was formed by the SEC in 2009 but the current committee conforms to mandates issued by the Dodd-Frank Act. Since individual investors are the primary source of capital for securities markets, it was argued that the focus on their needs would be the appropriate focus for the committee’s inaugural meeting.
The argument was based on the recent trend of investors to pull money out of equity mutual funds. The unwillingness of retail investors to be involved in the equities markets could reflect a shift in investment focus by the Baby Boomer generation as it ages. However, concern remains that retail investors may feel that the exchanges are geared heavily to benefit Wall Street firms instead of creating a level playing field for individuals.
Such concerns by individual investors could inhibit capital formation through investment in the equities markets. Allaying those concerns is, therefore, the top priority of the SEC’s Investor Advisory Committee.


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