U.S. securities regulators are cautioning exchanges to remain aware of the composition of indices used in various securities, as they could invite registration obligations.

The U.S. Securities and Exchange Commission (SEC) issued a report Thursday cautioning exchanges and investment professionals to monitor the composition of indices used in financial instruments to determine if they are futures products, and to ensure they are complying with the federal securities laws. And, it calls on exchanges to establish policies and procedures for monitoring the composition of indices to facilitate compliance.

The SEC’s alert was triggered by an investigation into Eurex futures that were being sold to U.S. investors, which were initially geared to a broad-based index that didn’t require registration. However, it says that the composition of the index narrowed to the point where it no longer qualified for an exemption from registration requirements.

The SEC says its investigation found that Eurex began selling futures on its Euro STOXX Banks Index more than 10 years ago under an exemption by the Commodity Futures Trading Commission (CFTC). In October 2011, Eurex reviewed the index for the first time in response to a request by the CFTC to confirm it was still broad-based, and found that, in fact, it had evolved into a narrow-based index in 2010.

As a result, the exchange violated several securities rules, the SEC says. However, it has decided not to pursue an enforcement action in the case due to the exchange’s “substantial and timely cooperation with the investigation and its prompt remediation efforts.”

“As the compositions of exchange indices fluctuate, it is critically important for exchanges to have policies and procedures in place to effectively monitor the composition of their indices and ensure that they are appropriately offering securities based on those indices to U.S. investors,” said Daniel Hawke, chief of the SEC Enforcement Division’s Market Abuse Unit.

“It is equally important for investment professionals to be mindful of the highly analogous situation involving security-based swaps, and the failure to appropriately monitor the characteristics of such financial instruments risks violating the federal securities laws,” he added.