SEC hearing calls to cut down 10-day stock reporting window

Some believe the window allows activist investors to tip off favored investors

Once an investor acquires at least 5 percent of a company’s stock, the investor currently has a 10-day window to announce their holdings to the Securities and Exchange Commission (SEC) per a 1968 regulatory rule. However, some officials believe that delay can lead to leaks, and they are pushing the SEC to change the disclosure time.

Following a Wall Street Journal investigation into the tactics of activist investors, some insiders have taken exception with the 10-day window. According to these officials, activist investors can “leak” their plans to certain favored investors, who can then act on the knowledge before it needs to be reported.

Assistant Editor

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Zach Warren

Zach Warren is Assistant Editor of InsideCounsel magazine, where he oversees online content submissions and administers InsideCounsel's enewsletters. Zach specializes in new media and multimedia...

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