Subject: File No. S7-24-15
From: Dmitry Arshansky

February 19, 2020

I would like to voice my opinion in opposition to the proposed SEC regulation regarding leveraged and inverse funds.

I believe leveraged and inverse funds are important investment tools that allow me and other investors to seek enhanced returns and protect my portfolio.

As an individual investor I am perfectly capable of understanding how these products work, and certainly dont want anyone evaluating my investment capabilities in this regard, and/or potentially preventing my from buying these securities.

I dont want government-imposed regulations limiting my ability to invest in publicly traded securities just because someone at the SEC thinks they are trying to protect me from some perceived problem.

There is no question that there are risks involved in investing in equities in general. But how are these risks any different for leveraged and inverse funds than for any other publicly traded securities? What about risks of buying shares of Enron and watching the price go to zero, or buying shares of Lucent at $80 and seeing them drop to $2? What about shares of countless other publicly traded companies that went bankrupt resulting in huge investor losses? You dont even need a corporate bankruptcy, or leverage for that matter, in order to lose money in the markets you just need to make a bad investment. Is the SEC going to protect investors from those losses as well?

When is the government going to stop trying to protect us from every possible eventuality that we may encounter with our investments? Enough of this nanny state. Why not tell investors to do their homework before making a free choice in the public markets? We lose money when we make bad investment decisions, but isnt that the way markets should operate? The answer to that is not some bureaucratic regulation thats going to save us from ourselves, it is investors doing more of their own research and due diligence before buying anything.

As my last point let me suggest that there is actually quite a bit of academic research that supports the idea of using leveraged products to increase the returns of investment portfolios. As one example I offer you a 2016 paper by Michael A Gayed and Charles V. Bilello of Pension Partners Leverage for the Long Run: A Systematic Approach to Managing Risk and Magnifying Returns in Stocks. What it demonstrates is that when using leveraged products in a thoughtful and responsible way the results can be quite beneficial to investors. By restricting or eliminating these products from the public markets the SEC would actually be hurting, not helping, responsible investors, while helping the irresponsible ones, who would most likely find other ways to lose their money.

I urge you to preserve our freedom of choice and not go forward with the proposed regulation.