The proposed rule would be a huge misstep. Investing strategies which use leverage, especially leveraged exchange-traded funds should not be restricted to the rich, they should be available for every investor. Decades of investment research show that maximizing the efficient frontier using a diversified portfolio, such as stocks and bond funds, and applying leverage is superior to individually picking stocks without leverage, and has lower risk and drawdowns. Leveraged ETFs have made this fundamental investment truth easy to implement for investors regardless of net worth. If you restrict the use of leverage you'll see investors that are unable to qualify for these guidelines flocking to risky 'meme' stocks and losing everything, instead of sticking to a safe and publicly verified index that is responsibly leveraged with an ETF.
Samuel Hinkle Comment On Regulatory Notice 22-08
The proposed rule would be a huge misstep. Investing strategies which use leverage, especially leveraged exchange-traded funds should not be restricted to the rich, they should be available for every investor. Decades of investment research show that maximizing the efficient frontier using a diversified portfolio, such as stocks and bond funds, and applying leverage is superior to individually picking stocks without leverage, and has lower risk and drawdowns. Leveraged ETFs have made this fundamental investment truth easy to implement for investors regardless of net worth. If you restrict the use of leverage you'll see investors that are unable to qualify for these guidelines flocking to risky 'meme' stocks and losing everything, instead of sticking to a safe and publicly verified index that is responsibly leveraged with an ETF.
Thank you for your consideration.