Overview
Mutual funds (excluding money market funds) and ETFs are subject to a comprehensive liquidity risk management regulatory framework, adopted by the SEC in 2016 and amended in 2018. In 2024, the SEC provided additional guidance to funds about their liquidity risk management program requirements. The SEC’s 2022 proposal would (i) amend the liquidity risk management rule for mutual funds and ETFs and (ii) mandate that mutual funds impose a “hard close” on investors’ orders and use swing pricing.
ICI Contacts
News & Publications
News & Publications
ICI Statement on the Federal Reserve’s Enhanced Supplementary Leverage Ratio Proposal
Washington, DC; June 25, 2025—Today, Investment Company Institute (ICI) President and CEO Eric Pan released the following statement regarding the Federal Reserve Board’s proposal to change the enhanced supplementary leverage ratio (eSLR) for banks. “We welcome today’s announcement that the Federal Reserve Board is proposing a change to the onerous enhanced supplementary leverage ratio (eSLR) for banks, which will allow them to play a larger role in market-making and help ease stresses in US Treasury markets. The modifications to loosen the eSLR should be acted on with urgency. “Liquidity is...
ICI Commentary: What the Bank of England’s System-Wide Exploratory Scenario Exercise (SWES) Tells Us
VIEW AS PDF In late November 2024, the Bank of England published the results of its first system-wide exploratory scenario (SWES) exercise—a year-long effort to model how various financial entities, including non-bank financial intermediaries (NBFIs) and banks, would respond to a significant liquidity shock. While the findings are inherently tied to the specific stress scenario created for the exercise, the results showed that open-end funds (OEFs) and money market funds (MMFs) were neither the catalysts for, nor the primary drivers of, market-wide liquidity stress events. This key takeaway...
ICI Statement on SEC Adoption of New N-PORT Reporting and Liquidity Risk Management Guidance
Washington, DC, August 28, 2024—Today, Investment Company Institute (ICI) President and CEO Eric Pan released the following statement regarding the Securities and Exchange Commission’s (SEC) vote to adopt changes to Form N-PORT reporting requirements and liquidity risk management program guidance. “ICI has raised serious concerns about moving portfolio holdings disclosure on Form N-PORT from quarterly to monthly, as this will open fund managers to a greater risk of predatory trading that will harm fund shareholders, without any corresponding benefit. ICI has also questioned the SEC’s...
The SEC’s Liquidity Proposal Is Arbitrary and Harmful to Investors
Open-end long-term mutual funds (“funds”) have a long history of successfully managing liquidity, enabling them to meet shareholder redemptions in a timely manner while pursuing their investment...
Research & Statistics
Research & Statistics
ICI Response to Singapore Consultation on Liquidity Risk Management Practices
ICI responded to the Monetary Authority of Singapore (MAS) consultation on updates to its guidelines on liquidity risk management practices for fund management companies.
ICI Response to FCA Consultation on Liquidity Management Tools
ICI submitted a comment letter to the Financial Conduct Authority (FCA) on its consultation on updates to the FCA’s Handbook and guidance regarding liquidity management tools, which are being undertaken in order to reflect IOSCO’s recently updated LMT recommendations.
ICI Joint Comment Letter to the SEC on Foreign Private Issuer Eligibility
ICI, along with SIFMA AMG, submitted a letter to the Securities and Exchange Commission (SEC) in response to their concept release on foreign private issuer eligibility. The letter commends the SEC for undertaking a comprehensive review of foreign private issuer eligibility and urges a nuanced approach that preserves liquidity and access for major global issuers in U.S. capital markets. Read more in the comment letter.
ICI Response to IOSCO Consultations on OEF Liquidity Risk Management
The Investment Company Institute submitted a letter with its views on the International Organization of Securities Commission’s consultations on revised recommendations for liquidity risk management for open-end funds and the guidance for the effective implementation of the recommendations. Read more in the comment letter.
Additional Resources
Resources
Background
- Form N-PORT and Form N-CEN Reporting; Guidance on Open-End Fund Liquidity Risk Management Programs (August 28, 2024)
- SEC’s 2022 Liquidity, Swing Pricing, Hard Close, and Form N-PORT proposal (November 2, 2022)
- SEC Liquidity Disclosure Amendments (pdf) (June 28, 2018)
- SEC Staff Frequently Asked Questions: Investment Company Liquidity Risk Management Programs (Feb 22, 2018)
- SEC Interim Final Rule on Investment Company Liquidity Risk Management Programs (Feb 22, 2018)
- SEC Final Rule on Investment Company Liquidity Risk Management Programs (Adopting Release) (Oct 13, 2016)
Global Initiatives
- IOSCO’s Anti-dilution Liquidity Management Tools – Guidance for Effective Implementation of the Recommendations for Liquidity Risk Management for Collective Investment Schemes (pdf) (Dec, 2023)
- FSB’s Revised Policy Recommendations to Address Structural Vulnerabilities from Liquidity Mismatch in Open-Ended Funds (pdf) (Dec, 2023)
- IOSCO’s Open-ended Fund Liquidity and Risk Management – Good Practices and Issues for Consideration (pdf) (Feb, 2018)
- IOSCO’s Recommendations for Liquidity Risk Management for Collective Investment Schemes (pdf) (Feb, 2018)