What you Should Know About Financial Markets Regulation


There are both positive and negative results of regulating the financial markets. There are various reasons why players in the financial sector love regulation. For example, regulation prohibits rogue activities such as insider trading, which can leave investors with huge losses. In some countries, regulation work is left to a single body. In other jurisdictions, regulation may be carried out by multiple bodies. Regulation has various advantages and disadvantages.


Countries Follow Different Rules

Every country has regulatory bodies that set up specific rules that have to be followed by participants in the financial sector. The main difference among the bodies is the extent to which they are involved in the financial industry.


In some countries, all matters related to the financial sector have been assigned to a single regulatory firm. Therefore, investors that want to participate in the financial sector have to deal with the regulator in one way or another. Trading securities, banking and insurance are some of the financial sectors that the bodies may be in charge of. All the rules related to the financial sector of the country may be made by the regulatory body. Know more at this website https://chrisbrummer.com/!


There are various advantages of having a single regulatory body. For investors, operating in the financial markets becomes easier when there is only a single regulator to deal with. Both players and investors can easily get the guidance they need regarding specific issues related to the financial sector. Apart from this, making one contact can address all your financial needs at the time.


Enforcement of various rules is easier when a country only has a single regulator. The regulator can also easily address all the concerns that player in the securities or other financial markets may have.


Having More than One Regulator

In some countries, the financial industry is divided into subsectors which are then regulated by different bodies. For example, regulation of the insurance sector may be done at a state level. When it comes to banking, you may find that the central government is the one in charge of the regulations. Other sectors of the financial markets, such as securities and futures trading, may be regulated by other bodies. Read more about chris brummer here!


Multiple regulators in a market also have their pros and cons. For instance, when there are multiple regulators in the industry, players and investors are likely to get specialized help. This help would not be easily provided if there was only one regulator in the county. Moreover, since none of the agencies have unlimited powers, they are bound to cooperate with each other.


If you want to start trading in securities, you should know about the regulators bodies in your jurisdiction. Check this out: http://money.cnn.com/2008/03/29/news/economy/financial_overhaul/.