kaal:claim:2998097-010

Investor suitability standards requiring independent verification of an investor's ability to evaluate complex financial products and investment risk would make wealth redundant as a proxy for sophistication in determining investor eligibility.

Source quote, verbatim

Such proposed investor suitability standards would require independent verification of investors' ability to evaluate highly complex financial products and investment risk, rendering wealth as a proxy for sophistication redundant for investor eligibility.54

From

Wulf A. Kaal, Private Investment Fund Regulation - Theory and Empirical Evidence from 1998 to 2016 (2017), III.2 Indirect Regulation, p. 15
https://ssrn.com/abstract=2998097 · source PDF

Cite as

Wulf A. Kaal, Private Investment Fund Regulation - Theory and Empirical Evidence from 1998 to 2016 (2017). SSRN: https://ssrn.com/abstract=2998097

Holds when

private investment fund investor eligibility
proposed in 2009, before Title IV

Classification

designsupport: arguedinstitutional-design

Related claims

extends kaal:claim:1806252-032 The numerical wealth requirements used to define qualified hedge fund investors fail as a regulatory device, b...
extends kaal:claim:1428387-030 Unless an investor's business is primarily to invest in hard-to-value assets, that investor's sophistication c...
extends kaal:claim:1428387-028 Investor suitability standards are the author's preferred regulatory option because they would probably protec...

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