Limiting the use of hard-to-value assets and complex financial products is very unlikely to have positive effects, because the implicit inhibition of financial innovation would probably limit investors' use of hedging products and interfere with economic expansion.
Source quote, verbatim
assets. It is very unlikely that limiting the use of financial instruments will have positive effects. The implicit inhibition of financial innovation would probably limit investors' use of hedging products and interfere with economic expansion.232
From
Kaal, Hedge Fund Valuation Retailization, Regulation, and Investor Suitability (2009), VI.A Limitation on the Use of Hard-to-Value Assets and Financial Products, p. 48 https://ssrn.com/abstract=1428387 · source PDF
Cite as
Kaal, Hedge Fund Valuation Retailization, Regulation, and Investor Suitability (2009). SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1428387
Holds when
where regulators respond to systemic risk by restricting instrument use
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