Dear FINRA,
Leveraged ETFs are a relatively new entrants into the stock market, with the first fund being introduced in 2006. These ETFs give retail investors easy access to leverage that does not subject them to margin calls, or expire worthless like an option. Another innovation made possible by Leveraged ETFs, are inverse strategies. By providing investors with the ability to hedge their portfolios with a means to gain short exposure to various assets without having to take derivatives positions, or shorting stocks themselves, inverse strategies, like leveraged funds, give retail investors access to another area that had largely been dominated by institutions.
In summary, Leveraged and inverse funds have several advantages, theyre readily accessible, arent subject to margin calls, and dont require a detailed understanding of complex derivatives.
Tim Williamson Comment On Regulatory Notice 22-08
Dear FINRA,
Leveraged ETFs are a relatively new entrants into the stock market, with the first fund being introduced in 2006. These ETFs give retail investors easy access to leverage that does not subject them to margin calls, or expire worthless like an option. Another innovation made possible by Leveraged ETFs, are inverse strategies. By providing investors with the ability to hedge their portfolios with a means to gain short exposure to various assets without having to take derivatives positions, or shorting stocks themselves, inverse strategies, like leveraged funds, give retail investors access to another area that had largely been dominated by institutions.
In summary, Leveraged and inverse funds have several advantages, theyre readily accessible, arent subject to margin calls, and dont require a detailed understanding of complex derivatives.
Thanks