- An SEC advisory panel recommended individual investors be given increased access to invest in private funds, the WSJ reported.
- Retail investors could benefit from the performance of funds accessible to wealthier investors and institutions.
- The Asset Management Advisory Committee’s recommendation doesn’t change SEC rules.
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An advisory committee at the Securities and Exchange Commission has recommended the agency grant individual investors easier access to private equity funds, according to a Wall Street Journal report.
Members of the Asset Management Advisory Committee on Monday voted unanimously to approve a report that concluded the agency should increase access to private-equity, private-debt and real estate vehicles.
The vote adds to efforts in recent years by some regulatory bodies to allow more retail investors into private funds which are currently limited to institutions and wealthy investors, the WSJ report said. Retail investors are those who don’t meet wealth or professional requirements to qualify as accredited investors.
The AMAC’s report said retail investors could benefit from the performance of private funds, which has been in line with or better than comparable public-markets products.
“Wider access could initially be considered within a set of ‘Design Principles’ that balance the potential benefits to retail investors from wider access to private investments with sufficient investor protection,” said the group’s report, which was prepared by a subcommittee.
Representatives of asset-management firms, including investors in private markets, are among those included in the Asset Management Advisory Committee. The group’s vote doesn’t change the SEC’s investment rules.