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dividend increase Sep 19, 2015

Clearly this is a misguided proposed rule change. Many conservative investors depend on options as part of their income-oriented risk-reducing strategy (including covered calls).

The U.S. Securities Markets Coalition - composed of The Options Clearing Corporation and the U.S. options exchanges - has submitted comments against the proposed rule.

You can voice your concern directly to the DOL by any of these methods:

  1. Email: e-ORI@dol.gov and include RIN 1210-AB32 in the subject line of the message;
  2. Visit Federal eRulemaking portal at regulations.gov, follow instructions for submitting comments;
  3. Mail or Courier to: 
    Office of Regulations and Interpretations
    Employee Benefits Security Administration
    Attn: Conflict of Interest Rule, Room N-5655
    U.S. Department of Labor
    200 Constitution Avenue NW.
    Washington, DC 20210

The comment period will close September 24, 2015.

Here are a couple of sample letters, but feel free to use your own words.


Sample Letter #1

To: e-OED

Subject: DOL Limiting Choices in IRAs

Dear Department Of Labor:

Recently, I became aware of a proposed rule that would undermine my ability to plan for my retirement in ways I believe best for me, and I want to share my concerns with you.

My understanding is that the Department of Labor's (DOL's) proposed retirement rule would limit my ability to trade listed options in my IRA. It's a limitation that, to me, makes no sense.

I have traded options in my IRA, just as I have in non-retirement brokerage accounts, and I had to qualify for this privilege. Education and support from my brokerage firm are available to me 24-7 to answer questions or validate ideas. I can join online communities, take courses, watch instructional videos, test strategies, or speak to a representative any time I want.

This proposed rule would change all of that by making my brokerage firm a fiduciary for my IRA – responsible for looking out for my best interests – if it provides any research, tools or education that the rule views as "advice." My account in its current state would likely be considered an "advised IRA," and as I understand the rule, options trading would be prohibited in it.

In order to trade options in my IRA, my brokerage firm would likely be required to remove most research, tools and educational resources so my account would not be considered an "advised IRA." Or, my firm could convert my account to a more expensive investment advisory one. Neither appeals to me.

With this rule, it seems the government has determined that I am not smart enough to make my own informed investment decisions. I do not agree. The rule will only divert my attention and assets away from my IRA and toward other, non-retirement accounts.

Saving for retirement is difficult enough. Why add more obstacles and complexity? I urge you to please preserve the freedoms investors currently enjoy to choose how we invest in our retirement accounts and plan for a better financial tomorrow.

Sincerely,


Sample Letter #1

To: e-OED

Subject: DOL Limiting Choices in IRAs

Dear Department Of Labor:

I am an investor. My financial security, and that of my family, are very important to me – especially when I consider my retirement. Recently, I became aware of a proposed rule that would undermine my ability to plan for my retirement in a way I believe is best for me, and I want to share my concerns with you.

My understanding is that the Department of Labor's (DOL's) proposed retirement rule would limit my ability to trade listed options in my IRA. It's a limitation that, to me, makes no sense.

Today, I am free to choose how I use financial services and the level of help or support I need. I can completely manage some investments on my own, using the tools and education provided by my broker as I see fit; or I can ask for fee-based advice and discretionary account management. In addition, I can use many of the same investment strategies and products in my IRA that I do in my non-retirement accounts. This gives me the flexibility to choose exactly what I need to meet my goals at a competitive price that I'm willing and able to pay.

As a self-directed investor, I should retain the freedom to make those decisions – regardless of the type of brokerage account (retirement or non-retirement) that I hold.

I have traded options in my IRA, and I had to qualify for this privilege. Education and support from my brokerage firm are available to me 24-7 to answer questions or help validate my ideas. I can join online communities, take courses, watch instructional videos, test strategies, or speak to a representative any time I want. And, while I know options are not suitable for all investors, I have determined that they are suitable for me, based on my experience, knowledge and financial situation.

This proposed rule would change all of that by making my brokerage firm a fiduciary for my IRA – responsible for looking out for my best interests – if it provides any research, tools or educational resources that the rule views as "advice." My account in its current state would likely be considered an "advised IRA," and as I understand the rule, options trading would be prohibited in it.

In order for me to continue to trade options in my IRA (which is what I want to do in pursuit of my investment goals), my brokerage firm would likely be required to remove most research, tools and educational resources so my account would not be considered an "advised IRA." Or, my firm could convert my account to a more expensive investment advisory one. Neither choice appeals to me.

With this rule, it seems the government has determined that I am not smart enough to make my own informed investment decisions. I do not agree. The rule would only drive me – and likely other investors – to trade options in non-retirement accounts, thereby decreasing the funding we have available for our IRAs. I'm sure that's not the DOL's intent, but it's a very real possibility.

Investing for retirement is difficult enough. With nearly a decade of historically-low interest rates to challenge American investors, why add more obstacles and complexity? I urge you to preserve the freedoms investors currently enjoy to choose how we invest in our retirement accounts and plan for a better financial tomorrow.

Sincerely,

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