What does the term 'Regulator' generally refer to in the investment industry?

What does the term 'Regulator' generally refer to in the investment industry?

• A. Only the IIROC
• B. Only the MFDA
• C. A collective term for various regulatory bodies
• D. The government entities only

Answer: (C)

The term 'Regulator' in the investment industry refers to a collective term for various regulatory bodies that oversee different aspects of the market and ensure compliance with laws and regulations. Regulatory bodies play a crucial role in maintaining the integrity of the financial system, protecting investors, and promoting fair and efficient capital markets. In Canada, for example, organizations such as the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association (MFDA) are prominent regulators. They work independently but collectively contribute to a comprehensive regulatory framework.

Understanding that 'Regulator' encompasses multiple organizations rather than being confined to just one specific entity or type of entity helps highlight the complexity and comprehensive nature of regulatory oversight in the investment industry. This collective approach ensures that various areas such as trading practices, investment advising, and customer protection are covered, promoting overall investor confidence and market stability.