Hi there, I oppose the proposed regulatory enhancements. I especially disagree with tying the ability to trade or invest in leveraged ETFs (or other "complex funds") to net worth. Nothing about having a high net worth guarantees a better understanding of complex funds. Someone with a small portfolio is capable of doing their due diligence before investing in or trading complex funds. I also oppose any "cool down period," as this would effectively make trading such funds impossible—depending on how long the time frame is. As a small retail investor who carefully studied the risks associated with leveraged ETFs before investing in them, these new proposed rules would prevent me from utilizing my current investment strategy. I would lose the freedom to invest how I desire, all because I don't have the established wealth of a rich investor or the credentials of an institutional one. Losing this freedom would limit my options to things like index investing or stock picking, which carries its own risks. To match the performance of my current strategy, it's possible I'd have to work an additional job or even push back retirement entirely. A reasonable balance would be requiring brokers and trading platforms to have retail investors read a brief material describing the risks associated with leveraged funds (such as volatility decay). This could even include various examples of how such funds would have performed during unfavorable market conditions. After reading that, the investor would be required to attest to reading the material, as well as agree to take on all responsibility for trading or investing in complex funds. Thank you for considering my comment, and I wish you all the best - Daniel A
Daniel A. Comment On Regulatory Notice 22-08
Hi there, I oppose the proposed regulatory enhancements. I especially disagree with tying the ability to trade or invest in leveraged ETFs (or other "complex funds") to net worth. Nothing about having a high net worth guarantees a better understanding of complex funds. Someone with a small portfolio is capable of doing their due diligence before investing in or trading complex funds. I also oppose any "cool down period," as this would effectively make trading such funds impossible—depending on how long the time frame is. As a small retail investor who carefully studied the risks associated with leveraged ETFs before investing in them, these new proposed rules would prevent me from utilizing my current investment strategy. I would lose the freedom to invest how I desire, all because I don't have the established wealth of a rich investor or the credentials of an institutional one. Losing this freedom would limit my options to things like index investing or stock picking, which carries its own risks. To match the performance of my current strategy, it's possible I'd have to work an additional job or even push back retirement entirely. A reasonable balance would be requiring brokers and trading platforms to have retail investors read a brief material describing the risks associated with leveraged funds (such as volatility decay). This could even include various examples of how such funds would have performed during unfavorable market conditions. After reading that, the investor would be required to attest to reading the material, as well as agree to take on all responsibility for trading or investing in complex funds. Thank you for considering my comment, and I wish you all the best - Daniel A