This is a sample investment adviser form which is a sample client acknowledgement of the highly speculative nature of leveraged or inverse ETFs in which the client confirms that he or she understands such risks and is seeking a high risk investment.
In addition to this client acknowledgement, an investment adviser firm which recommends leveraged or inverse ETFs should also develop written policies and procedures. Please see our sample WSP/CoE Section Update at https://www.ria-compliance-consultants.com/product/wsp-coe-section-update-inversed-leveraged-etfs/ for an example of compliance policies and procedures for an investment adviser recommending such ETFs. The recommendation or selection of such products is highly risky and should only be done afer careful review of the SEC investor bulletins and enforcement actions. See https://www.ria-compliance-consultants.com/2017/02/sec-enforcement-action-etfs-and-failure-to-follow-policies-and-procedures/ .
Included with Platinum Packages. Initially posted in January 2021.
SEC’s Investor Advocate Identifies Leveraged and Inverse ETFs as Risk to Retail Investors (January 26, 2021); and
SEC Enforcement Action – ETFs and Failure to Follow Policies and Procedures (February 15, 2017).
This sample document is merely an example for general reference and educational purposes. RIA Compliance Consultants, Inc. is providing this sample document to the purchaser on an “as is” basis with no warranty or guaranty whatsoever.
This sample document should be considered a starting point, and purchaser should not treat this sample document as a final document ready for use. The sample document has not been customized to the purchaser’s business model, the specific investment advisory rules applicable to the purchaser’s investment adviser or the written supervisory procedures and code of ethics of purchaser’s investment adviser.
This sample document may not be applicable or appropriate for every investment adviser. The purchaser should not consider a sample document purchased from our online store as an exhaustive, comprehensive or definitive list of the items necessary to meet the purchaser’s obligations under the applicable investment adviser laws and rules.
This sample document is not intended to detect or prevent fraud, selling away, Ponzi schemes, undisclosed outside business activities, inaccurate or false fee calculations, theft, misappropriation or unlawful conversion of client funds.
Due to changes of investment adviser laws and rules, this sample documented may become outdated and need to be updated or discontinued. RIA Compliance Consultants, Inc. will not be providing any subsequent updates of this sample documents to the purchaser. Likewise, RIA Compliance Consultants, Inc. will not be monitoring and reporting to the purchaser any issues related to the use of this sample document.
Since this sample document may not reflect the specific investment advisory requirements of the purchaser’s securities regulator, the purchaser should check with the securities regulator(s) with jurisdiction over its investment adviser or review any applicable rules before using this document.
This sample document is not a substitute for retaining a compliance professional to advise and assist the purchaser regarding its investment adviser’s compliance program. Unless otherwise agreed to in writing, the purchaser understands that the purchaser has not engaged RIA Compliance Consultants, Inc. in a consulting relationship by merely purchasing or utilizing a sample form. Additionally, the purchaser understand that unless otherwise agreed to in writing, RIA Compliance Consultants, Inc. is not responsible for customizing this sample document, updating the sample document, preparing the purchaser’s written supervisory procedures or code of ethics, or notifying the purchaser of changes to the investment adviser laws and rules.
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