Product-Specific Disclosures: Investment Companies and Variable Contracts

What this video covers

• Why calling a fund "zero expense" or "no expense" violates the misleading sales literature standard if other investor costs are omitted
• How standardized return metrics work: the mandatory 1-year, 5-year, and 10-year periods plus current-to-quarter requirement
• Why sending a summary prospectus satisfies prospectus delivery, and the 3-business-day clock for statutory prospectus, statement of additional information (SAI), and shareholder report requests
• Where variable contract guarantees actually live: the general account, not the separate account, and why guarantees depend on the insurer's claims-paying ability
• The hypothetical illustration caps: 12% maximum gross return ceiling and mandatory 0% floor scenario
• Why variable contracts cannot be represented as short-term liquid investments: surrender charges plus the 10% early withdrawal tax penalty before age 59.5
• The 10-business-day FINRA filing requirement for certain variable contract retail communications, and why total return rankings must use independent entities with strict period rules
• Why a bond fund volatility rating measures NAV sensitivity, can never be labeled a risk rating, and must disclose its non-standard methodology