Investing In Mutual Funds

Investing in Mutual Funds

When you invest in a mutual fund, the fund manager pools your money with other investors’ assets to make investments in a variety of securities issued by various companies.

Mutual fund managers vote on behalf of all of their customers, and, as an individual investor with a limited number of shares, you can’t influence how the fund votes. However, investment companies have a fiduciary responsibility to act in the best interest of their customers, and an obligation to vote accordingly.

Historically, mutual fund companies weren’t required to disclose why and how their proxies were voted. However, in 2003, the Securities and Exchange Commission (SEC) amended the rules governing disclosure requirements by mutual funds to address investment companies’ fiduciary responsibility to their investors. The amended rules now require mutual funds to:

  • Disclose their proxy voting policies and procedures
  • File Form N-PX—a form that documents the fund’s proxy voting records for the previous 12 months—annually with the SEC
  • Disclose their proxy voting records to their shareholders

SEC Rule 30b1-4


Broadridge Footer
Broadridge Footer
Broadridge footer