March 10, 2020
In reference to File Number S7-24-15, New Rules for Certain Leveraged/Inverse Investment Vehicles:
I take great exception to the new proposed rules on certain leveraged/inverse investment vehicles as detailed in File Number S7-24-15.
Risk is an inherent part of investing, and investors must take risk into account when making an investment decision. As an individual investor, I take the time to study a potential investment closely and learn the details risks of it before making an investment decision, and this includes leveraged/inverse investment vehicles. Currently, less than 3% of my total investment portfolio is tied up in these vehicles. I have studied these vehicles and are keenly aware of the risks involved with them, which is exactly why my exposure to these vehicles is so limited.
I have had a self-serve brokerage account for many years. Like any investor, I have made money on some trades while losing money on other trades. I have been able to realize some gains during the recent decline in the market from these leveraged/inverse investment vehicles, and I do not want to give up the opportunity to trade these vehicles in the future simply because I am a small individual investor. I realize how risky they are, which is exactly why I have strictly limited my exposure to them. The prospectuses I have reviewed also detailed the risks associated with them. Given that I am a small individual investor, I am very concerned that such rules would lock me out of the ability to buy and sell these vehicles. I am also of the opinion that brokerage firms should not be in the nanny business, deciding who can and cannot trade certain investment vehicles.
Unless the Commission has an overwhelming amount of indisputable evidence which clearly proves that the holders of these leveraged/inverse investment vehicles have absolutely no idea what they are doing when they invest in these vehicles, and unless it can be unquestionably demonstrated that the offerors of these vehicles are intentionally and obviously deceiving investors as to the nature and risk associated with these vehicles, I strongly urge you to reject the rule and allow individual investors to make their own choices.
Thank you for your time and consideration.
Glenn A. Fetty