FINRA News

Several brokerage firms have stopped selling leveraged exchange traded funds (ETFs) after the Financial Industry Regulatory Authority Inc. warned brokers that they “typically are unsuitable for retail investors” who hold them longer than a day . Exchange Traded Funds (ETFs) are funds that track indexes like the NASDAQ-100 Index, S&P 500, Dow Jones, etc. When you buy shares of an ETF, you are buying shares of a portfolio that tracks the yield and return of its native index. The main difference between ETFs and other types of index funds is that ETFs don’t try to outperform their corresponding index, but simply replicate its performance. They don’t try to beat the market, they try to be the market . Read more: http://www.nasdaq.com/investing/etfs/what-are-ETFs.aspx#ixzz2wthHCXTA Edward Jones banned the sell of ETFs shortly after the announcement and LPL prohibited the sale of leveraged ETFs that seek more than two times the long or short performance of the target index . However there are still [...]

The SEC has adopted the FINRA communication rule, which has some noticeable changes from the previous NASD rule, according to the article on Mondaq.com. One noticeable change was the consolidation of the six communication categories into three- institutional communication, retail communication and correspondence. The article further illuminated the difference between retail and institutional correspondence, per FINRA and The SEC. There are also many other requirements set forth by FINRA and the SEC putting forth standards for retail and institutional communication as well as review procedures for such communication. The article also states that a “public appearance” is no longer a separate category and will fall under the new guidelines and requirements of the communication rule. […]