Washington, D.C. – MFA issued the following statement from President and CEO, Bryan Corbett, regarding the SEC’s finalization of the short position and short activity reporting rule and securities lending rule:
“Short selling benefits all investors by reducing bid-ask spreads, dampening volatility, and detecting waste, fraud, and abuse at companies. MFA appreciates the SEC’s approach to publicly disclose short interest aggregated by issuer. This provides investors with decision-useful investment information and protects the ability of short sellers to do their essential work. However, MFA is disappointed that the final rule places burdensome and costly reporting requirements on investment managers instead of adjusting, consolidating, and leveraging data already collected.
“In adopting the final short sale disclosure rule, the SEC acknowledged the benefits of short selling and the value of short sellers maintaining anonymity to prevent short squeezes, retaliation, and disclosure of proprietary investment strategies. However, the final securities lending rule ignores the rationale for protecting individual short sellers and exposes confidential lending information on a loan-by-loan basis. As a result of the securities lending rule, investment advisers will face more risk when selling short, which will harm investors, market participants, and market efficiency.”
About the Global Alternative Asset Management Industry
The global alternative asset management industry, including hedge funds, credit funds, and crossover funds, has assets under management of $4 trillion (Q4 2022). The industry serves thousands of public and private pension funds, charitable endowments, foundations, sovereign governments, and other global institutional investors by providing portfolio diversification and risk-adjusted returns to help meet their funding obligations and return targets.
About Managed Funds Association
Managed Funds Association (MFA), based in Washington, DC, New York, Brussels, and London, represents the global alternative asset management industry. MFA’s mission is to advance the ability of alternative asset managers to raise capital, invest, and generate returns for their beneficiaries. MFA advocates on behalf of its membership and convenes stakeholders to address global regulatory, operational, and business issues. MFA has more than 170 member firms, including traditional hedge funds, credit funds, and crossover funds, that collectively manage nearly $3 trillion across a diverse group of investment strategies. Member firms help pension plans, university endowments, charitable foundations, and other institutional investors to diversify their investments, manage risk, and generate attractive returns over time.