MessageFrom: Michelle Hoesly [Resource1@prodigy.net]
Sent: Monday, May 10, 2004 9:18 AM
To: rule-comments@sec.gov
Subject: File No. S7-11-04

Dear Mr. Katz,

I would like to voice my strong opposal to the 2% mandatory redemption fee 
proposal for mutual funds.  This is unnecessary and has the potential of causing 
more harm.  It is my understanding that funds which have difficulty with short 
term trading, already have the option of instituting short term redemption fees.   
Many funds have not had problems with short term trading and this would require 
them to impose a possible hardship on fund holders.  The fund holders most 
likely to get caught in the short term redemption fees are the small investor.  
Sophisticated investors will avoid these fees through other options, but the 
small investor will be more likely to be unaware of the fee, or will not think 
of the fee when doing systematic distributions or rebalancing.

The problems of international fund arbitrage can currently be handled with 
current redemption fee options and eliminating stale pricing.  Funds with low 
liquidity can also institute the short term redemption fees.  Do not make this a 
requirement!  Let the fund managers determine if there is a problem with short 
term trading in their fund and address their needs under the more than adequate 
current options.

Michelle L Hoesly
1401 Duck Run Ct.
Virginia Beach, Va. 23455