FSOC Hosts Discussion on Asset Management
May 20, 2014
On Monday, May 19, the Financial Stability Oversight Council of the U.S. Department of the Treasury hosted a series of discussions regarding asset management. Faculty Affiliate Itay Goldstein participated on a panel that focused on the, “investment activities and risk management practices within the asset management industry.” According to an article in MNI News covering the conference, Goldstein said, “regulators need to concentrate on whether there are mechanisms within the asset management model that ‘can amplify’ the effects of ‘massive redemptions.’ He said there needs to be more study of the mechanisms of ‘first mover advantage,’ as investors see the tide turning and want to get out before the rest. Even in mutual funds with a floating net asset value, the first movers may see an ultimate advantage, he said. ‘The floating NAV can’t eliminate the possibility of a run.’” A video recording of the conference is available online here.