SEC proposes rule changes to allow performance-based fees for funds

SEC: The U.S. Securities and Exchange Commission is the federal agency that regulates securities markets, enforces investor protections, and oversees investment advisers and funds. Under the current administration and Chair Paul Atkins, the agency proposed rule amendments on September 30, 2026, to expand circumstances for performance-based compensation in regulated funds. This move supports broader retail access to private market strategies while incorporating governance and disclosure requirements. Donald Trump: Donald Trump serves as President of the United States. His administration has prioritized expanding retail investor access to alternative assets through executive actions, including an order on democratizing such investments for 401(k) participants. The SEC's recent proposals on performance fees are framed as complementing these efforts to bring private market strategies to a wider audience. Regulatory Initiative: The SEC voted on September 30, 2026, to propose modernizing performance-based compensation rules for advisers to registered funds, subject to board oversight and other conditions. Administration Priority: President Trump's executive order focuses on expanding opportunities for investors to access alternative assets in retirement accounts, which the SEC proposals aim to support.