Their job is to put those funds to work as soon as possible. Mutual funds were eager to take the money from these pension funds. The mutual fund’s management fees were based upon the amount of money (value of shares) held by the fund. More money held by the mutual fund meant more money at the end of the quarter for the fund’s managers. Pension managers had a legitimate problem with knowing just how much money they had to invest on any given day. There are changes from day to day as beneficiaries took withdrawals or employers made deposits. An ostensibly harmless practice developed where mutual funds let it be known that they could be flexible about taking purchases at that morning’s price after the closing, even though that was prohibited by their rules. This was a matter of accommodating fund managers and encouraging them to trust that fund with their investment. People were beginning to realize unanticipated uses for computer technology, in particular people realized they could track what was happening to the value of any mutual fund’s investments as quickly or even quicker than the mutual fund managers could using relatively simple spreadsheet programs. They realized that if permitted to buy after the close they could know what tomorrow’s price would be and provided they sold the shares tomorrow morning that they bought that evening would be guaranteed a profit, a profit that ordinary customers that played by the rules could not get. The trades involved small variances in price but because the buyers were purchasing millions of dollars in mutual fund shares the guaranteed profits for these insiders was significant and secure. Such trades could be made with information about after-hours market developments in other countries, for example. Traders would buy in at the previous day's close, and sell at the next day's close for a likely profit. This practice hurt long-term buy-and-hold investors in the mutual fund, who experienced a continued drain in the fund's net asset value (or NAV). Late trading was not a new phenomenon. Prior to 1968, most mutual funds used "backward pricing," in which the fund could be bought at the previous closing price. Thus, traders could purchase mutual funds on a day when the market was up, at the previous day's lower closing price, and then sell at the purchase date's closing price for a guaranteed profit. To prevent the exploitation