Investments such as TQQQ are especially usefull to average, non-professional investors such as me.
I have made good profits from this high quality ETF.
Instead of implementing restraining regulations to diminish trades in high quality ETFs, FINRA should help spread the word about these great funds and allow more people to use them.
Please don't use tunnel vision to be short sighted.
Adding additional regulation in advisors and ETFs seems misguided and misplaced. Regulators should be focused on what is creating the real wealth destruction for individual investors which is options trading done by novice investors. By regulating ETFs in this manner it is placing a barrier to using an effective hedging tool that has been in existence long enough for advisors and BDs to know
Sirs,
It is not clear what regulations you plan that would limit leveraged/inverse EFT and similar inventments. However, I would like to strongly suggest that anyone with several years experience in stocks/options be allowed to trade them unless their account is in the "savings" category v.s. "investment" category. Restricting experienced individual investors
We don't need your help. anyone who trades should be responsible for their own actions. These ETFs are not complex, individuals just fail to take the few minutes to read the information that each ETF provider is required to provide. Retail investors don't need your protection because we are so stupid and unable to understand "complex" ETF's. Thanks for
Leverage ETF is like a high growth stock. It makes no sense to require investment to pass a test to trade or even hold the leverage ETF.
Netflix (NFLX) is a good example of a high growth stock. It was one of the best performing stocks for over 2 decades, but in just 5 short months, it drops from $700.99 on 11/7/2021 to $199.87 today's closing (5/3/2022) or down over 70%.
It poses a severe threat towards market fairness. It's like preventing people from skiing because it's dangerous, but except the rich ones. Retail traders or investors should be able to freely choose whatever products that fit their trading strategies. Finance is NOT only for the rich or the privileged. We know what leveraged funds are. Also, the liquidity will be severely
Please leave it to individual investors to make investment decisions for themselves.
What I would suggest is the following: You may require that a prominent warning for LEVERAGED funds like SPXU, TMV, etc. be displayed that they their value decays with time and therefore they are suitable only for short term trades. The current common warning that they are suitable for EXPERIENCED day traders is
Comments: Instead of restricting investments in leveraged or inverse products, a focus should be on education. Explanation of risks and scenarios will help investors decide what they want. Certain automation steps may be helpful. Example- Limiting the investment in complex products in accounts that trade a lot, and/or limiting the amount of complex products as a percentage of total portfolio.
You may think you're protecting people, but what this regulation will actually do, is keep the poor, poor, and keep the rich, rich. One way us people of lower classes can get ahead, is to learn advanced trading techniques. By making limits to 'high net worth individuals" you are perpetuating a cast system in this country. Stop treating us like children.
I oppose restrictions to my right to invest in leveraged and inverse Exchange Traded Funds. There are already risk notification requirements for these investments. By their nature of being a fund, leveraged and inverse funds can be safer than using account margin or short selling. Leveraged and inverse vehicles allow me to participate in markets as I see fit. I do not want additional measures
