The US watchdog is conducting a review related to firms’ supervision of concentrations in non-principal protected structured notes with a worst-of basket option.
Finra announced today that it has started to examine how firms supervise concentrations in ‘higher-risk structured products’, specifically non-principle protected notes (NPPNs) with a worst-of option. Highly concentrated investments can pose risk, and that risk is heightened when the concentrated investment is a complex product - Finra The review will focus on how firms supervise concentrations in these products, including how they comply with Regulation Best Interest (Reg BI) an