Subject: N/A
From: Geert Bekaert

Mar. 17, 2020

Comment on SEC Proposed Rule #S7-24-15: 

The proposed regulation on derivatives use may undermine access to leveraged and inverse funds for active retail investors. Some brokers have already stopped offering them. This is a shame. Prospecti regarding such funds tend to be very clear and transparent about the risks and the e.g. implications of volatility drag. There are margin requirements and brokerages can impose more stringent ones. Many of these products are innovative and help complete markets making sophisticated strategies available to retail investors. They also provide healthy competition for expensive and unsophisticated hedge fund strategies. I worry that additional regulation may ultimately amount to severely restricting investor's choices. By the way, what you hope to accomplish with VaR computations is beyond me. 

geert bekaert