European securities regulators have launched a review of their efforts to protect retail investors from risky, complex products, such as contracts for difference (CFDs) and binary options.
The European Securities and Markets Authority (ESMA) initiated a review of the measures that it has employed to deal with the risks posed by trading in CFDs and binary options, including prohibitions and restrictions on their sale to retail investors.
The ESMA first introduced temporary curbs on the sale and marketing of these products in mid-2018. The temporary restrictions were renewed several times, until they were allowed to expire in July of this year, after most local regulators adopted permanent measures to address the risks.
Now, the ESMA is consulting on the impact of these measures.
In particular, the ESMA is seeking feedback from industry firms, investors and trade groups on the practical effects of its product intervention measures, and insight into any unintended consequences.
The deadline for responses is Nov. 4.