Compare a fund's holdings with the focus its name suggests
Key facts
- Human involvement
- YellowClose supervision
- How AI is used
- List the fund's name, the words in the name that suggest an environmental, social or governance focus, and each holding the portfolio file labels as inside or outside that focus, with the source. Do not say the name is deceptive.
- What the lawyer must review
- 17 C.F.R. § 270.35d-1(a)(2) treats as materially deceptive or misleading a name suggesting that a fund focuses on investments with particular characteristics, and it gives as an example terms indicating that investment decisions incorporate one or more environmental, social or governance factors, unless the fund has adopted a policy to invest, under normal circumstances, at least 80 percent of the value of its assets in accordance with that focus, the policy is fundamental or shareholders get at least 60 days' notice of a change, and the terms match plain English or established industry use. The 80 percent test applies at the time of investment, with at least a quarterly review of the 80 percent basket and, in the circumstances the rule states, a return to compliance as soon as reasonably practicable and within 90 consecutive days. Paragraph (c) says a name may still be materially deceptive or misleading even if the fund adopts and follows that policy. The rule's definition of fund is a registered investment company or a business development company, including a separate series. You decide whether a holding is in the basket. The tool does not.
- Written for / version
- United States versionUS
Who does what
| Role | What they do |
|---|---|
| Assistance | Consider narrowly defined preparation support after confirming the tool’s capability and permitted scope. |
| Lawyer | Set the scope, supervise the work closely, verify every part relied on, resolve omissions and exceptions, and approve the exact output. |
Checklist
- Obtain and inspect the relevant current official register or search result. Confirm identities, interests and the date and scope of the search.
- Confirm the output against the client’s instructions and the complete relevant source material, including omissions or contradictions.
- Resolve exceptions and record the responsible lawyer’s approval of the exact output and intended use.