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The need for further mutual fund reform remains in two major areas. First, there is a need for greater and more effective disclosure of fund charges and greater transparency in the manner in which funds operate. While it is probably overly optimistic to expect that this will make a dramatic difference in investors' preferences for one fund over another, at least it will make it possible for the investor who does care about costs and conflicts of interest to determine how efficiently a particular fund is managed vis-a-vis its competitors. A generation ago, funds with a front end sales load averaging 6% was the norm. Due to increasing publicity and competitive pressures, the no-load fund has replaced the load fund as the norm in the fund industry. Also, the increasing popularity of index funds and ETFs, while still not a majority of fund sales, shows that there are, in fact, investors who are sensitive to the importance of mutual fund expenses and sales charges as an important component of a fund's long-term relative performance. Further education and disclosure, through both the financial press and fund prospectuses, should increase the pressure on funds to operate efficiently and in furtherance of the fiduciary duty which they owe to their investors.

Second, in order to protect less sophisticated investors from being sold unsuitable funds with high fees and mediocre performance, the need exists for the strengthening of fiduciary duties owed by fund managers and financial advisors to ensure that they put investors' interests ahead of their own. With the defined contribution retirement plan rapidly becoming the primary vehicle for retirement savings for millions of individuals, the need for strong and effective mutual fund regulation now is more compelling than it has ever been.

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