Ticker Talk

The trade group for the mutual fund industry is calling for major revisions to a federal proposal that would require funds to disclose after-tax performance to investors. The Investment Company Institute said “on balance” it supports the proposed Securities and Exchange Commission rule. But ICI still wants “significant modifications”--including that funds should have to include the data in their prospectuses, but not in their annual reports.

The issue of fund taxation and its effect on net fund returns has become a hot button in recent years. Because funds distribute realized capital gains each year, investors who hold funds outside of tax-deferred accounts face annual tax bills that effectively reduce their returns. They also can be further taxed if they sell their fund shares at a gain.