Institutional Investment & Fiduciary Services - August 18 - Weekly Market Update

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Last week it came to light that the Securities and Exchange Commission (SEC) had launched a review (or “sweep”) of alternative mutual fund managers, better known as liquid alternatives.  The SEC’s examination is not an investigation based on belief of wrong doing, but rather proactive oversight as assets under management in liquid alternatives have more than doubled from $76.7 billion (9/30/2011) to $156.2 billion (6/30/2014) in less than three years.  The SEC is said to be gathering information about the industry and funds as they focus on the liquidity of the funds, use of leverage, investment allocation, and the degree of governance and oversight by the funds’ boards.