Commentary

David Weisberger
Traders Magazine Online News

Stop the BS & Promote Real Transparency!

In this shared blog, David Weisberger says a recent WSJ article is wrong and that traders do need to purchase faster and more comprehensive market data to avoid being fined for violating "Best Execution" obligations.

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February 1, 1998

New Soft-Dollar Standards Proposed

By Staff Reports

The Association for Investment Management and Research (AIMR), a Charlottesville, Va.-based non-profit trade group, has released a proposed set of soft-dollar standards for its buy-side members.

The standards, developed by a blue-ribbon task force of industry leaders convened by the trade group, are open to public comment until Feb. 28.

Understanding

These standards include the creation of a common understanding of soft-dollar issues by providing definitions of major terms; and requirements that the content of research purchased with client brokerage directly assist an investment manager in his decision-making processing, and not in the management of the firm.

Also included in the standards are a clarification of an investment manager's responsibility to justify the use of client knowledge to pay for a portion of mixed-use products.

Disclose

The standards require AIMR members to disclose certain information with regard to soft dollar practices; uniform record keeping; and clarification of an investment manager's real and fiduciary responsibilities to his client, including the client-directed brokerage area.

These responsibilities cover the client-directed brokerage area.