Valentine’s Day Gift To NASD Members

As of February 14, 2005, NASD members will be able to provide investment analysis tools to their customers without running afoul of NASD Conduct Rule 2210(d)(1)(D), which currently prohibits members from making predictions or projections regarding investments or investment services. Under newly SEC-approved NASD Interpretive Material to Conduct Rule 2210 (IM-2210-6), NASD created a limited exception to Conduct Rule 2210 that will allow members to provide investment analysis tools to their customers, subject to certain NASD requirements. An investment analysis tool is defined in IM-2210-6(b) as:

an interactive technological tool that produces simulations and statistical analyses that present the likelihood of various investment outcomes if certain investments are made or certain investment strategies or styles are undertaken, thereby serving as an additional resource to investors in the evaluation of the potential risks and returns of investment choices.