SEC Plans to Open Private-Market Investments to Ordinary Investors

Full analysis

The U.S. Securities and Exchange Commission (SEC) is preparing a rule that would allow ordinary retail investors — not just wealthy or institutional ones — to invest in private markets, such as private equity and private credit funds. The proposal would also let investment advisers charge performance fees (fees tied to investment gains, rather than a flat rate) to a broader set of clients beyond the current "qualified clients" threshold, which is limited to higher-net-worth individuals. The rule would work by letting retail investors access private markets through registered funds, which carry some regulatory oversight.

Private-market investments have historically come with fewer disclosure requirements than publicly traded stocks or bonds, making them harder to value and riskier for investors who lack resources to do independent due diligence. Groups like Better Markets have warned that broadening access exposes everyday investors to those risks. The proposal is still early in the regulatory process: after White House review, the SEC will release it for public comment before voting on a final rule. Readers who use a financial adviser should watch for how any final rule changes the fees they can be charged.