Evolving Retail Customer Access to These Products Raises Heightened Regulatory and Investor Protection Concerns

On March 8, 2022, the Financial Industry Regulatory Authority, Inc. (“FINRA”) issued Regulatory Notice 22-08 (Complex Products and Options) (the “Notice”). The Notice is FINRA’s most significant statement on sales of complex products since 2012.

FINRA notes that the number of accounts trading in complex products and options has increased significantly in recent years and that important regulatory concerns arise when investors trade such products without understanding their unique characteristics and risks. Further, these concerns may be heightened when retail customers access these products through self-directed platforms without the assistance of a financial professional. In light of these concerns, FINRA cautions that trading in complex products and options requires member firm scrutiny and supervision.

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