Tuesday, September 27, 2011

Transparent as a brick wall

Inveska's algorithms are based on SEC-required disclosures that mutual funds must make.  Easy, right?  The SEC has a website, the disclosures are on there, so just go grab them.  It's that easy, right?

Well, it should be.  And for many fund companies, it is.  For Vanguard, Fidelity, Dodge & Cox, and others, it is that easy.

For some, it isn't.  In particular, T. Rowe Price and Franklin put their disclosures in JPG images.  So you can't simply copy and paste the information and do something useful with it.  Take a look at this disclosure from T. Rowe Price Capital Opportunity.

Now, I suppose they would argue one of two things:

  1. They are trying to prevent a competitor from analyzing their trades.  Okay, I suppose, except that these don't come out in real time.  They come out a month or so late, so it seems that the competition excuse is a weak one.
  2. It's for formatting - it makes them look better.  Of course, Fidelity and Vanguard have no problem making theirs look good without putting all the real data in images.

I think the real reason is clear - they're trying to prevent the very transparency that the SEC is trying to promote with these rules.  And shame on them for that.

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