Subject: File No. S7-17-11
From: Douglas Wood

June 13, 2011

Please don't raise the limit from $1.5M to $2.0M and please don't exclude the value of one's primary residence from the new net worth calculation.

Please don't make this rule change.

This rule change penalizes Americans who chose to own a home instead of renting. This rule is unfair to home owners

Consider this example,

A 50 year old investor who is a VP of finance at a fortune 500 company with years of financial experience has paid off is $800,000 home and has saved up $1,500,000 in cash through wise investing. He also has a stable $220,000 per year income.

Currently this person has the option to invest in hedge funds with a healthy $2.3M net worth (when including the value of his primary residence), stable income and a home that is fully paid off. This is the type of sophisticated and stable investor who both understands the risk of hedge fund investing and can afford to take those risks.

However, under the proposed rule change this investor would no long have the option to invest in hedge funds just because he owns a home which must be excluded from his net worth with the proposed rule change. His new net worth excluding the value of his prime residence would only be $1.5M below the new $2.0M net worth limit proposed by this rule change.

However, if he sold his home for $800,000 and instead rented a place to live he would then magically have a $2,300,000 net worth when excluding the value of his primary residence since he no longer has a primary residence and is instead renting.

As you can see this rule change favors investors who chose to rent rather than own a home.

Please do not penalize home owners and make it more difficult for them to invest in a hedge fund just because they chose to own a home instead of renting one.

I contend home ownership makes an investor more stable and a better candidate to invest rather than a worse one. Also home ownership is good for a more stable America.

So I urge the SEC to please not make this rule change.

Especially please do not remove the value of an investor's primary residence from the net worth calculation as this penalizes home owners and favors renters which is unfair. We need to encourage home ownership with the current housing crisis not discourage it with rule changes like this.

Thanks for considering my comment.