February 19, 2020
We have an RIA firm that infrequently uses leveraged or inverse products as part of a well diversified portfolio that attempts to limit risk. In the past we have used an inverse stock market product in periods of market turmoil to protect clients' portfolio values without having to recognize capital gains. We have also use an inverse bond market product to protect against rising interest rates. Occasionally, we use a leveraged market index product to reap higher returns when the market is trending strongly.
In all of these cases, we monitor the products closely and sell them them when our goals have been met or the market condition changes.
I would ask that you not put up roadblocks to using these products for our client accounts.