The Securities and Exchange Commission is considering a proposed rule change submitted by the Financial Industry Regulatory Authority, Inc. (FINRA). This change aims to exempt certain business development companies (BDCs) from existing restrictions on buying and selling initial public offerings (IPOs). Specifically, non-traded BDCs will be allowed to purchase new IPOs more easily, just like publicly traded BDCs and other investment companies. This move is designed to give these non-traded BDCs and their investors better access to diverse investment opportunities, potentially improving their portfolio balance and investments in new stock issues.
Simple Explanation
Imagine there are rules about who can buy shiny new toys when they first come out. The people who make the rules want to let certain groups that usually can't buy these toys when they're new get a chance to buy them, hoping they can have more fun and new toys to play with.