Fund Valuation Rule (2020)
The SEC adopted a rule governing how funds value their portfolio securities. The rule's guidance effectively restricted cross-trading of most fixed-income securities, even though the SEC recognized at the time that revisions to the cross-trading rule were under consideration.
Fixed-income cross-trades were largely prohibited.
Funds lost the ability to trade bonds directly with affiliates, increasing transaction costs.
The current proposal would reverse this restriction by restoring Level 2 fixed-income cross-trading.
