T. Rowe bars some American Airlines workers from fund trading
- Gary Haber[1]
- Staff Reporter- Baltimore Business Journal
- This email address is being protected from spambots. You need JavaScript enabled to view it.[2] | Twitter[3]
T. Rowe Price Group has permanently barred some participants in American Airlines’ 401(k) retirement plan from trading between several of Price’s mutual funds offered in the plan.
Bill Benintende[4], a T. Rowe spokesman, declined to discuss details but said in a statement that the move comes after the firm “issued several warnings about excessive trading by a small minority of plan participants over a number of years.”
“T. Rowe Price has a fiduciary obligation to protect the interests of all fund shareholders against excessive trading that may disrupt portfolio management and negatively impact performance,” Benintende said in a statement.
Reuters reported Monday[5] that the ban affects about 1,300 American Airlines (OTC: AAMRQ) workers — less than 2 percent of the 80,000 employees in the airline’s $uper $aver retirement plan.
The plan participants who are affected will still be able to put new money into the mutual funds through payroll deductions, or take their money out of the funds, Benintende said. In addition to the 1,300 American workers receiving the permanent ban, warning letters were sent to another 800 workers, Reuters reported.
Benintende declined to identify the mutual funds to which the ban applies. Reuters reported that they are T. Rowe’s High Yield, Science & Technology, MidCap Growth and New Horizons funds.
Benintende declined to discuss what prompted T. Rowe (NASDAQ: TROW) to put the trading ban in place. But Reuters reported that it came comes after temporary restrictions on trades by some plan participants who subscribe to the EZTracker LLC investment newsletter aimed at American Airlines employees. If a large number of shareholders trade into or out of a mutual fund at the same time, that can be disruptive for the fund’s other shareholders.
Gary Haber covers Banking, Finance, Insurance, Law
References
- ^ Gary Haber (feeds.bizjournals.com)
- ^ This email address is being protected from spambots. You need JavaScript enabled to view it. (feeds.bizjournals.com)
- ^ Twitter (twitter.com)
- ^ Bill Benintende (feeds.bizjournals.com)
- ^ Reuters reported Monday (www.reuters.com)