January 3, 1992
TO: MEMBERS - ONE PER COMPLEX NO. 1-92
RE: EXPANDED STATISTICAL COLLECTION AND DISSEMINATION PROGRAM
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I. Background
The growth and diversity of the mutual fund industry, as
well as the increase in public, media and governmental interest
in funds, has created an explosion in the requirements for data
about the industry and individual funds. This information is
required by fund management companies, various service providers
to the mutual fund industry, others in the financial marketplace,
regulatory bodies, the media, and the public.
This explosion of interest in mutual fund data has led to
several problems:
(1) mutual fund companies are almost overwhelmed by requests
for data, most of which is already publicly available;
(2) much of the information that has been compiled on
individual funds is not readily available in an electronic
format;
(3) the cost of accessing the data that is available has often
been high, and in some cases fund groups have had to pay
for data they supplied to third-party data collectors in
the first place; and
(4) some fund groups are concerned about the accuracy of data
being used by others to calculate their investment
performance.
In addition, the Institute has had to rely on outside
sources for basic mutual fund performance information. Such
information is needed to support regulatory, legislative and
public information objectives.
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In its capacity as a primary repository of data about the
industry, excluding investment performance information, the
Institute has been aware of the growing needs for a modern data
collection and dissemination system for its members and other
data consumers. As a result, the Investment Company Institute
has undertaken a project to become a centralized collector and
disseminator of industry data.
The implementation of this project will facilitate reaching
several objectives endorsed by the Institute's Board of
Governors:
1. ICI members will be given various means to respond to the
many requests for data from numerous data analysts and
collectors. Members will be able to refer third-party data
collectors directly to the Institute's data subscription
service to fulfill such requests or use the universal data
collection forms developed by the Institute to respond to
requests by such collectors.
2. ICI Members and third-party providers of services to the
mutual fund industry will be guaranteed access to the data
they need at a reasonable cost. This will allow such
service providers to perform a variety of analytical and
informational functions.
3. The Institute will be able to satisfy its own needs for a
comprehensive investment company database to help it
respond to regulatory, tax and legislative demands on a
timely basis.
II. Collection of new data
As part of its expanded data collection and dissemination
program, in early 1992 the Institute will begin collecting two
new series of data -- primary investment performance information
and portfolio asset composition data. With the addition of these
data series the Institute will have an essentially complete
database of all material publicly available information for
virtually all open-end investment companies and for most closed-
end funds.
The following is a description of the two new
questionnaires which will be used to collect the new data series.
PERFORMANCE QUESTIONNAIRE. Beginning in early 1992, the
Institute will commence daily collection of NAVs and income
distribution detail. The primary means of collecting this
information will be electronic capture of data from the daily
NASDAQ feed. Those funds that for whatever reason do not supply
this information to NASDAQ will be contacted daily by phone by
the Institute in order to make this part of the database as
comprehensive as possible.
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As part of this effort, a new universal monthly performance
questionnaire (See Attachment 1) will be sent to all complexes.
It is designed to encompass the universe of performance data
currently requested of each fund by all of the third-party data
collectors. The data will be used to verify/supplement data
collected directly and from the daily NASDAQ mutual fund
electronic feed and by telephone.
Although the universal questionnaire will contain some
information that funds already provide in the NASDAQ feed, it
is crucial that ICI obtain data directly from the funds in
order to check for errors and to ensure the integrity of ICI
data. Initially, ICI will also receive comparative data from
an independent data collector, as a further step to ensure
completeness and accuracy of the ICI database.
The performance related information collected by the
Institute, along with relevant historical data, will be made
available to members by subscription. This service will
also be made available to subscribers outside the membership
after June 1, 1992.
QUARTERLY QUESTIONNAIRE. (See Attachment 2) The new quarterly
questionnaire has been developed to replace the existing Annual
Questionnaire. It is designed to collect detailed asset
composition, yield, dividend and shareholder account data. The
availability of this information to members on a fund-by-fund and
asset-class by asset-class basis is discussed below. Only
aggregate information will be released publicly.
RULES FOR ACCESS TO DATA
The guiding assumption for the data collected by the
Institute is that all of the individual fund data, except the
sales and redemption data and expense information, may be
released to the membership and eventually to subscribers on an
individual fund basis. This information is made public in either
prospectuses or reports to shareholders. There are two important
exceptions to this assumption:
1. Fund groups which prefer not to have their individual fund
data included in its subscription service for non-members
may notify the Institute in writing and none of their data,
other than performance-related data, will be disseminated
outside the Institute's membership. This applies on a
complex-wide basis; either all data for all funds in a
member group may be disseminated, or none of it will be
made available to third-party subscribers. The Institute
strongly prefers to be able to disseminate all data but
recognizes some groups may have special considerations
which are overriding.
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2. As a general principle, portfolio composition information
collected by the Institute will be made available within
the membership on an individual fund basis at the Level III
of detail (as explained below).
Some members may have reservations regarding dissemination
of portfolio composition detail even among members. To
accommodate members' various preference in this regard and at the
same time encouraging universal reporting, the Quarterly
Questionnaire was designed with several levels of aggregation in
mind. Level I, designated by capital letters (i.e., A-Equities,
B-Debt, etc.), is of such level of generality that dissemination
of these aggregates on an individual fund basis should pose no
problem to any member group. Level II is designated by arabic
numbers (i.e., 1-Common Stock, 2-Preferred Stock, or 1-U.S.
Government Securities and agency issuer, etc.). Level III is
designated by lower-case letters (i.e., a)-U.S. securities, b)-
Foreign securities, etc.).
Members may request in writing to the Institute that all
information at a particular level of aggregation for all funds in
the group not be disseminated. For example, a fund group may not
object to have data on holdings of common stock (Level II) on a
fund-by-fund basis made available to other members but may be
unwilling to disseminate the data reflecting the split as between
U.S. and foreign equities (Level III). In this case, the group
would have an option to ask the Institute not to disseminate the
Level III data on its funds. By the same token, this group will
forfeit the right to have access to Level III data supplied by
other groups.
Such a request, made 30 days prior to the data release
date, will remain in effect at least one year. It may be revoked
by another written notification.
Individual fund portfolio composition information at any
level of detail will not be released outside the membership.
This information may, however, be released externally only when
aggregated across funds.
ACTION REQUESTED
1. Members are requested to review the new questionnaires
attached and establish their internal procedure to respond
when the first collection cycle begins in January 1992.
2. Complete the attached form (Attachment 3) to advise the
Institute to whom the two new questionnaires should be
mailed. (The Institute will begin collecting this
information by mail but will add these questionnaires to
the new FUNDS system when it is released in the spring of
1992.)
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3. Advise the Institute by letter if your group chooses to
impose restrictions on dissemination of some of its data,
as described above.
Questions regarding the questionnaires should be addressed
to Anne Schafer (202) 955-3565 or Natalia Parmly (202) 955-3595.
Questions relating to dissemination policy may be directed to
Jacob Dreyer (202) 955-3560 or me (202) 955-3503.
C. Richard Pogue
Executive Vice President
Attachments
cc: Industry Statistics Committee
Research Committee
Statistical Contact Persons