SEC today adopted a rule aimed at preventing conflicts of interest...

SEC today adopted a rule aimed at preventing conflicts of interest when mutual fund portfolio managers and other employees buy and sell stock for their own accounts. Under the rule, a mutual fund’s board of directors must adopt the fund’s code of ethics, which must address personal trading practices. The rule also requires mutual fund officials to provide an initial listing of their securities holdings, updated annually. Moreover, portfolio managers and others involved in the fund’s investment decisions must get advance clearance for investing in initial public offerings and private placements of securities. Mutual funds also will be required to give investors information about their policies on personal trading practices. Finally, the fund’s board of directors must review annual reports from the fund regarding problems that have arisen under the code of ethics during the past year.