Chicago Tribune – Some individual investors want the Securities and Exchange Commission to know that they can take care of themselves.
Accusing the watchdog agency of sins ranging from paternalism to outright discrimination against the less-than-fabulously wealthy, dozens of investors have written to protest an SEC proposal that would sharply raise financial minimums for anyone who wants to invest in hedge funds in the United States.
“I believe that limiting any type of investment based on how much money a person owns is unfair and discriminatory,” wrote one correspondent in what was a fairly typical salvo. “The amount of money a person has to lose should not be used as a measure of that person’s sophistication as an investor.”
The SEC on Dec. 13 proposed limiting participation in hedge funds to people with at least $2.5 million in financial investments, up from the current minimum of $1 million in net worth, a figure that includes the value of a home.
In explaining that decision, SEC Chairman Christopher Cox has stated that high-risk, relatively lightly regulated hedge funds are no place for mom and pop investors. Now the agency is hearing from those moms and pops.
