Statement on Retail Options
I am concerned by reports of retail investors being unable to exercise options they purchased on Silicon Valley Bank and Signature Bank stock.[1] I am hopeful that broker-dealers and clearing agencies will make efforts to assist retail investors in exercising their options if the investors wish to do so, including by exploring possible cash settlements. In addition, I hope that FINRA and my colleagues at the SEC will move forward with efforts to establish a comprehensive regulatory framework around complex products, including options, which are risky and can expose an investor to sudden and severe losses.[2]
[1] See, e.g., Brandon Kochkodin, Retail Traders Left Hanging As More Brokers Halt Transactions On Silicon Valley Bank Just As Bets Are Set To Pay Off (Mar. 15, 2023); Elena Popina, Thousands of Stock Options on Failed Banks in Limbo as Expiration Hits (Mar. 17, 2023).
[2] See Commissioner Allison Herren Lee and Commissioner Caroline Crenshaw, Statement on Complex Exchange-Traded Products (Oct. 4, 2021).
Last Reviewed or Updated: March 17, 2023