The SEC is reportedly reconsidering its previous approval of a pair of quadruple-leveraged ETFs, with the full commission planning to review the staff members' decision to approve an application to trade the potentially risky funds. The SEC initially approved the ForceShares Daily 4X US Market Futures Long Fund and ForceShares Daily 4X US Market Futures Short Funds, despite having proposed a rule in 2016 that would limit the use of derivatives and leverage in mutual funds and ETFs. The decision also contrasted with recent warnings and enforcement efforts from both the SEC and FINRA aimed at protecting investors from complex, volatile investment products. It was not immediately clear what prompted the review of staff's decision, which was interpreted as a possible signal the proposed rule will not be adopted as the commission shifts gears under the deregulation agenda of the new administration.
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Quadruple-levered ETF? SEC hits pause on its approval of an exotic investment- Wall Street Journal
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