Post DOL Fiduciary Rule Effect on Investors

The story of the Department of Labor fiduciary rule has been nothing else but a roller coaster ride. The ride which began in 2015 and initiated by  President Obama’s administration, it peaked  in June of 2017 after DOL fiduciary rule’s partial implementation, and finally, on June 21, 2018, the 5th Circuit Court of Appeals confirmed its decision to vacate the rule, which was thought to be the end of it.

Currently, the Security and Exchange Commission is working on release of its own version of the DOL rule. Though, there are many questions if the SEC’s rule will provide similar benefits to investors, one thing becomes clear to all and that is the legacy left after the DOL rule. Specifically, based on Morningstar research, there is a decline in the investments to high load funds.

More and more investors become aware of load fund traps and start searching for more efficient ways to invest their money. On par with investors, large institutional players started to offer low or no cost funds to investors. The overall savings for investors from this alone should be huge. So, it can be argued that the DOL rule has left its mark on the current investment environment in a positive manner.

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