SEC Probes Exchange-Traded Products For Investor Risks

By Tom Zanki (October 5, 2021, 8:43 PM EDT) -- Gary Gensler, the U.S. Securities and Exchange Commission chairman, instructed the agency's staff this week to study risks posed by complex exchange-traded products and potentially recommend new rules, tackling an issue that has alarmed regulators for years.

Gensler said this study is part of a wider look at exchange-traded products, which he warned are more complex than typical stocks and bonds and present risks to investors that may need to be addressed by new rules, echoing statements made by prior SEC officials.

Such products can include "leveraged" or "inverse" exchange-traded funds whose value correlates to an underlying index based on certain multiples....

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