Buried in all the talk about what
will do to the big Wall Street banks are lesser-known provisions
aimed at protecting small investors. These measures may put the
broker-dealer exchange traded fund (
) in a position to benefit.
The newly formulated Dodd-Frank financial overhaul bill may make
brokers more accountable to clients, provide more information on
hedge funds and improve transparency of complex derivatives,
reports Eleanor Laise for Yahoo! Finance
. Barbara Roper, director of investor protection at the Consumer
Federation of America, believes that the legislation "lays the
groundwork for significant improvements" in protection and
disclosure, and also gives investors "a greater voice in the
policies that affect their interests." [
Tom Talks FinReg on CNBC.
The bill may also affect funds' bond and derivatives holdings,
along with how products may be advertised to investors. [
Financial ETFs Move on Global Banking Reform.
There's $3 trillion sitting on the sidelines right now while
investors wait for the kind of good news that will lure their
dollars back into the markets. Additional layers of protection for
investors may make the individual investor more comfortable. And
when that money returns, brokers will be positioned to take
iShares Dow Jones U.S. Broker-Dealers (NYSEArca:
Top holdings include Goldman Sachs (NYSE:
), Morgan Stanley (NYSE:
) and Charles Schwab (NYSE:
); in the last month, it's up 6.7%
For more information on ETFs, visit our
Max Chen contributed to this article.