This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Waddell & Reed Agrees to Market-Timing Settlement

Money manager Waddell & Reed (WDR - Get Report) will pay a $50 million penalty to securities regulators to settle claims arising from the nearly 3-year-old investigation into abusive mutual fund trading.

The Kansas-based financial firm said Monday it had reached a settlement with both state regulators and the Securities and Exchange Commission. The penalty stems from allegations that Waddell & Reed permitted hedge funds and other traders to market time some of its mutual funds.

Market timing is a trading arbitrage that involves frequently buying and selling mutual fund shares and playing them against the shares the fund owns. It's often harmful to long-term fund investors because it drives up the costs of operating the funds.

Over the past three years, regulators investigating abusive mutual fund trading have collected more than $3 billion in fines from mutual fund companies, brokerages and hedge funds.

"These settlements have been in the process for some time and relate to matters well in our past,'' says Waddell & Reed CEO Henry Herrmann.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
WDR $50.21 0.00%
AAPL $130.28 0.00%
FB $81.53 0.00%
GOOG $565.06 0.00%
TSLA $218.42 0.00%


DOW 18,080.14 +21.45 0.12%
S&P 500 2,117.69 +4.76 0.23%
NASDAQ 5,092.0850 +36.0220 0.71%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs