Denmark’s new retail risk labels 'too broad and inflexible'

traffic-lights
Traffic-light system for retail investment products

The Danish Financial Services Authority (FSA) has put in place a traffic-light labelling system that divides all investment products aimed at the retail market into three categories according to risk and complexity criteria, but market participants say its approach is broad and indiscriminate, and fails to achieve its goal of greater transparency and investor protection. "This divides the market in three categories, [but] does not really support the retail investor because the categories are