I don't believe that it is correct to classify products as complex due to their structure. Leveraged ETFs have their complexities, but so do many companies. Any given biotech stock may expose investors to more risk, but would be easier to access and trade. It's my belief that any investor who fails to understand the product they're buying deserves any losses they may take and that classifying some products as more complex and therefore riskier, FINRA may accidentally imply that ordinary stocks are comparatively safe when this is clearly not the case. Investors may be protected from a relatively safe 3x daily S&P ETF but still allowed to buy shares of SPACs, their warrants or even Gamestop at $400/share. At best, this classification and restriction would add a barrier to entry for retail investors, at worst it would give many of the same investors a false sense of safety.
Anonymous Comment On Regulatory Notice 22-08
I don't believe that it is correct to classify products as complex due to their structure. Leveraged ETFs have their complexities, but so do many companies. Any given biotech stock may expose investors to more risk, but would be easier to access and trade. It's my belief that any investor who fails to understand the product they're buying deserves any losses they may take and that classifying some products as more complex and therefore riskier, FINRA may accidentally imply that ordinary stocks are comparatively safe when this is clearly not the case. Investors may be protected from a relatively safe 3x daily S&P ETF but still allowed to buy shares of SPACs, their warrants or even Gamestop at $400/share. At best, this classification and restriction would add a barrier to entry for retail investors, at worst it would give many of the same investors a false sense of safety.