In The News

Asset Management Partner Paulita Pike Discusses COVID-19 Valuation Challenges for Fund Board in Fund Directions

Practices: Asset Management, Investment Management, Mutual Funds, ETFs & Closed-End Funds, Fund Boards of Directors / Trustees

An April 3 article by Fund Directions titled Board oversight of valuation tested by coronavirus-driven market turmoildiscusses how valuation oversight is one of the key challenges fund boards are facing amid COVID-19 driven market volatility. In the article, asset management partner Paulita Pike examines the SEC’s efforts to help funds weather the market turmoil.

The steps the SEC has taken so far to help funds weather market turmoil, such as extending interfund lending exemptive orders to all open-end funds, have been variations on existing relief and did not require much untangling, according to Paulita. Introducing valuation guidance, on the other hand, would require firms to dedicate resources to evaluating and implementing an unfamiliar form of regulatory relief at the wrong time. “I actually think the SEC has been wise not to issue anything new right now,” she says. “To think of new guidance in the valuation realm at a time when everybody’s trying their best to address the issues that are cropping up, I think, would probably make things more difficult rather than be helpful.”

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