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| Brandon Cragsley: Facepalm |
My jaw
dropped a couple days ago when I heard the latest news of the EU directive MIFID2.
As part of the MIFID2 directive, brokers within the EU will cease to allow European
customers to purchase American and Canadian ETFs and ETNs. What?! What the actual fuck?!
The
directive was supposed to:
“strengthen investor protection and improvethe functioning of financial markets making them more efficient, resilient andtransparent.”
Yeah, so it
will protect investors by blocking them from making purchases altogether.
The
reasoning behind the block is, that as the products don’t have information
available in all European languages, investors need to be protected (read: blocked) from such
devious products. But the investors who are looking at American or Canadian ETFs
probably know enough English to manage with the information provided in
English. Thus rendering the block only as a nuisance.
What the
regulators are trying to do here is protectionism but they’re only shooting
themselves in their own foot; to circumvent the directive's blockage, European investors will need
to take their business to a non-European broker. None of
this shooting yourself in the foot makes any sense what so ever!
At least
one of my brokers, Nordnet, will impose the blocks in the 3rd of
January. But then again, I don’t trade American or Canadian ETFs there due to
the extortionate pricing. I just hope, that my other broker, Lynx, will not
impose these blocks as I’m holding a multitude of American and Canadian ETFs (Vanguard, Horizons marijuana ETF, etc.) and intend to
buy more.
If you know
a trustworthy non-European broker that takes European customers, let me know please!
