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FINRA relaxes restrictions on pre-inception performance data

Richard F. Kerr (Boston, Massachusetts, USA office of K&L Gates LLP)
Matthew J. Rogers (Boston, Massachusetts, USA office of K&L Gates LLP)

Journal of Investment Compliance

ISSN: 1528-5812

Article publication date: 21 August 2019

Issue publication date: 16 October 2019




To explain the significance of a recently issued interpretive letter in which FINRA staff agreed to permit the use of pre-inception index performance data by passively managed, registered open-end investment companies.


FINRA recently issued an interpretive letter extending previously issued guidance by permitting passively managed open-end registered investment companies including separately-managed series of a business trust to use pre-inception index performance data in Institutional Communications.


The 2019 Letter is an important shift in how FINRA staff views PIP data in Institutional Communications by acknowledging that passively managed open-end funds should be treated in a similar manner as passively managed exchange-traded funds. This shift will be a welcome development for FINRA member firms wishing to include PIP data in marketing materials for the passively managed open-end funds they distribute.


Practical guidance from experienced investment management and broker-dealer lawyers.



Kerr, R.F. and Rogers, M.J. (2019), "FINRA relaxes restrictions on pre-inception performance data", Journal of Investment Compliance, Vol. 20 No. 3, pp. 6-9.



Emerald Publishing Limited

Copyright © 2019, K&L Gates LLP.

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