r/WallStreetBets really hates the SEC's proposal to weaken quarterly reporting | TechCrunch

"“approximately 18 million retail investors on Reddit” argued in the unsigned letter that quarterly financial filings - known as 10-Q filings - are “the single most important leveling mechanism between retail and institutional investors in U.S. equity markets.”"

"“Institutional investors have expert networks, channel checks, alternative data, satellite imagery of retailer parking lots, credit card panel data, and direct management access through conferences and one-on-one meetings that cost more than most of our portfolios. We have the 10-Q,” the letter reads."

"While the SEC isn't doing away with 10-Qs, the regulator's proposal suggests that companies will be able to elect every year whether they want to file an annual report and three quarterly reports (as is the case now) or simply one annual report and one semi-annual one. The rule change is particularly relevant as SpaceX - which is expected to allocate unprecedented IPO share to retail investors - along with a string of other buzzy and high-profile AI and tech startups begin queuing up for IPOs."

"“The Commission's release talks about reducing costs for issuers. We would like to know what the Commission thinks the cost is to a retail investor of holding a position for six months without a single mandatory disclosure from the company. The answer is not zero.”"

The SEC proposed weakening quarterly reporting standards for publicly traded companies. Public comments so far are largely negative. A letter from WallStreetBets, representing about 18 million retail investors, argues that 10-Q filings are the most important leveling mechanism between retail and institutional investors in U.S. equity markets. The letter claims institutional investors have extensive resources such as expert networks, alternative data, and direct management access, while retail investors rely on 10-Q disclosures. The proposal would allow companies to choose between filing three quarterly reports plus an annual report or filing only an annual report plus a semi-annual report. The change is framed as reducing real-time visibility and increasing costs for retail investors by forcing them to hold positions for six months without mandatory disclosure.

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