Retail investors are becoming more and more skilled, even as people have begun to invest from less traditional backgrounds. Requiring testing or other requirements prior to allowing investment in certain investment vehicles and products would effectively shut out many retail investors, particularly investors that are from non-traditional investment backgrounds.
Many investors, particularly investors from lower income backgrounds, do not have formal investment training. Instead, they are self taught. Many of these investors are quite savvy, although they may not have the traditional background and training of a typical investor. Cutting them off from specific investment products, while allowing high net worth individuals to continue to invest in them would effectively rig the system against smaller retail investors. This is patently unfair.
Additionally, the type of products that are impacted are quite broad. In particular, a retail investor may be interested in a new startup IPO. Closing that investment class would harm not only retail investors, but also startups looking for new investment, further limiting potential economic opportunity for individuals from non-traditional backgrounds.
FINRA regulations should level the playing field, not close the door to the field of play entirely. Let investors make those decisions for themselves.
Jay Hall Comment On Regulatory Notice 22-08
Retail investors are becoming more and more skilled, even as people have begun to invest from less traditional backgrounds. Requiring testing or other requirements prior to allowing investment in certain investment vehicles and products would effectively shut out many retail investors, particularly investors that are from non-traditional investment backgrounds.
Many investors, particularly investors from lower income backgrounds, do not have formal investment training. Instead, they are self taught. Many of these investors are quite savvy, although they may not have the traditional background and training of a typical investor. Cutting them off from specific investment products, while allowing high net worth individuals to continue to invest in them would effectively rig the system against smaller retail investors. This is patently unfair.
Additionally, the type of products that are impacted are quite broad. In particular, a retail investor may be interested in a new startup IPO. Closing that investment class would harm not only retail investors, but also startups looking for new investment, further limiting potential economic opportunity for individuals from non-traditional backgrounds.
FINRA regulations should level the playing field, not close the door to the field of play entirely. Let investors make those decisions for themselves.