Got an email from TOS regarding DOL decision that might impact TOS services to us, "remove most research, tools and educational resource so my account would not be considered and "advised IRA"" does that mean no more analyze tab and more business to OV?
I received this email today, as well:
The U.S. Department of Labor ("DOL") has proposed a rule that it believes will reduce conflicts of interest between financial professionals/firms and retail investors seeking advice in their Individual Retirement Accounts ("IRAs"). The rule would establish a strict "best interest" standard for advice relating to IRAs that, among other things, would prohibit the use of options in broker-advised retirement accounts.
The DOL rule includes numerous detailed, complex conditions that would negatively impact retail investors like you, including limiting your investment choices.
TD Ameritrade, along with many other brokerage firms, has conveyed serious concerns about the rule and its conditions to the DOL. You can view our recent comment letter here.
We believe that, as a valued client who has elected to trade options in your retirement account, you should be made aware of these potentially drastic changes and be given the opportunity to voice your own concerns with Washington before the rule becomes final.
Voice your concerns
The DOL proposed a rule to establish a strict "best interest" standard for advice relating to IRAs. Among other changes, the rule would prohibit the use of options in broker-advised retirement accounts. If you are concerned about these changes and your ability to continue trading options in your IRA, you have an opportunity to share your concerns with your Congressional representatives.
Why should I be concerned?
As a result of this rule, many tools, research, and information services that were previously viewed as guidance or education will likely be deemed "advice" and subject to the fiduciary "best interest" standard. This means, without changes to the rule as it currently stands, your account, if considered a broker-advised IRA, would no longer be eligible for options trading. In order for you to continue to trade options in your IRA, we would likely need to remove most research, tools, and educational resources so your account would not be considered a broker-advised IRA. Or, we could convert your account to a fee-based investment advisory account in which options could be used. The first approach may limit your ability to make informed trading decisions and the second would likely increase your costs.
These IRA options issues arise because, for the first time in history, the DOL is proposing a limited list of "permitted assets" in broker-advised IRAs. Options are not on this list. So even if a brokerage firm were willing to restructure its business to fit within the strict conditions of this rule, it could not allow the use of options in broker‑advised accounts.
What can I do?
If you are concerned about these changes and your ability to continue trading options in your IRA, you have an opportunity to make your voice heard.
We are making a tool available that can help you contact your Congressional representatives and tell them about your concerns. This tool includes contact information based on ZIP code, as well as letter templates that you can use or edit to suit your needs.
The DOL comment period for this rule will only be open for a short time. If this issue is important to you, we encourage you to speak out today.
Senior Vice President, Trader Group