Subject: File No. S7-25-06
From: Tony Jackson

January 28, 2007

In principle, I object to being limited in investment options simply because of a person's net worth.

I understand the premise that smaller investors need more protection than larger (presumably more experienced) investors.

However, this protection can cost the smaller investor in both total returns and in the volatility of their net worth.

For example, I think that denying smaller investors access to hedge funds in a mistake that costs smaller investors in both total returns and in the volatility of their net worth.

The premise of Modern Portfolio Theory is that you can smooth out the returns and decrease the risk of an investment portfolio by adding noncorrelated investment asset classes, even if those individual classes are individually highly volatile.

Many hedge funds' styles, by any reasonable assessment, are highly uncorrelated with the stock and bond markets. High-net-worth individuals and institutions are taking advantage of this fact by diversifying a part of their portfolios into hedge funds.

This reasonable diversification should be made available to smaller investors as well.

Again, I disagree in principle to being limiting in investment options based on a person's net worth.

I believe the explosion of investing information that is now available has increased the sophistication of investors everywhere.

I believe that increasing the available options to investors (such as hedge funds) will increase the sophistication of investors further.

At the very least, the current limit of $1 million of net worth should not be changed.

Thanks for your consideration.

Tony Jackson