Subject: N/A
From: Chris Bennight

Mar. 17, 2020

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

I believe the work the SEC has done in limiting the amount of leverage allowed in ETF's (current 3x effective limit) is good and reasonable - but I also find value in these leveraged funds and the flexibility they allow in retail investment decision. 

I find the 2x and 3x S&P and treasury funds specifically some of the *safer* leveraged options, and if additional restrictions were put on them might have to migrate to options or futures to achieved my desired exposure - both of which I think are riskier at the retail level. 

One key factor in my mind would not be the actual cost / scope of additional restrictions, but the *effective* cost of restrictions. I.e. if requirements similar to options trading privileges were added for leveraged etf authorization, the actual cost is not an issue - but what would be the impact on various retail customers; specifically would their brokerages all upgrade/alter/modify accounts to support this new provisioning, or simply drop support of these funds? If it's the latter I could see this having a chilling effect and pushing people to take riskier, possibly higher leveraged alternatives (options, futures) - having the opposite of the intended effect. 

Chris Bennight