Section 303-20-004 - Excessive Trading Restriction004.01 Purpose The excessive trading restriction found in this section limits the number of transfers permitted within a participant's account. Excessive trading by one or many participants can have a detrimental effect on other participants. In order to protect plan sponsors and participants, as well as meet regulatory guidelines and Mutual Fund Partner requirements, this section addresses this potential problem.
004.02 Only transactions that create the potential for market timing and excessive trading abuses will be subject to monitoring or trading restriction. Accordingly, only participant-initiated Exchange Purchases and Exchange Redemptions are monitored. The monitoring and trading restriction includes, but is not limited to, purchases and redemptions made as a result of a non-systematic reallocation or rebalancing transaction. The restriction is not affected by regular allocations of contributions, loans, or withdrawals.004.03 An Exchange Redemption executed within sixty (60) days of an Exchange Purchase will result in monitoring of the participant's transactions for the Monitoring Period. A rolling sixty (60) day period begins immediately following a Round Trip (an Exchange Purchase followed by an Exchange Redemption).004.04 A notice to the participant will be mailed after identifying an Exchange Purchase during the Monitoring Period. This notice will inform the participant that if the participant executes an Exchange Redemption during the remainder of the Monitoring Period, the participant will be subject to the trading restrictions.004.05 Where a participant executes a Round Trip during the Monitoring Period, the participant will be prevented from initiating subsequent Exchange Purchases in that fund for a sixty (60) day period following the Exchange Redemption that violated this section.004.06 All exchanges in other funds during the Purchase Restriction Period must be done via U.S. Mail. This provision excludes the use of phone, voice response, fax, web/internet, and hand-delivered means of executing trades.004.07 The participant will be notified upon the imposition of the trading restrictions in this section.004.08 Participant trading privileges will be restored automatically upon the expiration of the Purchase Restrictions Period.004.09 NPERS' Mutual Fund Partners may have excessive trading policies that are more restrictive than this Excessive Trading Restriction. In the event there is a violation of such Mutual Fund Partner policy, additional restrictions may apply, as directed by the Mutual Fund Partner.303 Neb. Admin. Code, ch. 20, § 004