Notice to Members 00-21
NASD Regulation Reminds Members of Their Responsibilities When Advertising Recent Mutual Fund Performance
Recent unusually strong equity market performance helped some mutual funds, particularly those that are heavily invested in technology stocks, to achieve extraordinary total return figures during the last year (or shorter period). Some members are using advertisements that promote this total return information to attract new investors. NASD Regulation, Inc. (NASD RegulationSM) reminds members of their responsibilities to present fund performance information in a fair and balanced manner and not to create unrealistic investor expectations with regard to future fund performance.
You may direct questions concerning this Notice to Thomas M. Selman, Vice President, Investment Companies/Corporate Financing, NASD Regulation, at (240) 386-4533; Thomas A. Pappas, Director, Advertising/Investment Companies Regulation, NASD Regulation, at (202) 728-8330; Joseph P. Savage, Counsel, Advertising/Investment Companies Regulation, NASD Regulation, at (202) 728- 8233; or Stephanie Dumont, Assistant General Counsel, NASD Regulation, at (202) 728-8176.