Zeviel Persellin Comment On Regulatory Notice 22-08
Zeviel Persellin
N/A
Hello FINRA, I regularly trade leveraged products. I would like to continue doing so, however, I do think that some of these products should go away. In particular 3X inverse products. Not because I want stocks to go up, but these products decay rapidly when implied volatility increases, which happens when the market goes down, so they can never meet their investment objectives. An easy example of this is SPXS during the COVID crash. When markets were down 25%, SPXS was actually lower than when markets were at all time highs. You can validate this statement on your own. The decay issue is less pronounced on 2X broad index products, but very pronounced on sector products. I would like the index products to stay, and the sector products to disappear. My point is, is that if these products cannot reasonably meet their objectives, they should not be approved. The ones that can, should stay.
Zeviel Persellin Comment On Regulatory Notice 22-08
Hello FINRA, I regularly trade leveraged products. I would like to continue doing so, however, I do think that some of these products should go away. In particular 3X inverse products. Not because I want stocks to go up, but these products decay rapidly when implied volatility increases, which happens when the market goes down, so they can never meet their investment objectives. An easy example of this is SPXS during the COVID crash. When markets were down 25%, SPXS was actually lower than when markets were at all time highs. You can validate this statement on your own. The decay issue is less pronounced on 2X broad index products, but very pronounced on sector products. I would like the index products to stay, and the sector products to disappear. My point is, is that if these products cannot reasonably meet their objectives, they should not be approved. The ones that can, should stay.