Elective professional clients and MIFID

Trading U.S. ETFs in the UK

Due to regulations, certain instruments offered by Stake, classified as Packaged Retail and Insurance-based Investment Products (PRIIPS) such as U.S. Exchange-Traded Funds (ETFs) cannot be offered to UK retail clients without the provision of a Key Information Document (KID). 

This restriction means that only ‘Professional or Elective Professional Clients’ (i.e non-retail customers) that meet certain criteria can invest in U.S. ETFs.

Information on the procedure for reclassification from retail to ‘Elective Professional’ Client

Stake is allowed to reclassify a retail client to an elective professional client, once it undertakes an adequate assessment of the expertise, experience and knowledge of the client that gives reasonable assurance, that the client is capable of making their own investment decisions and understand the risks involved.

In the course of that assessment, at least two out of the following three criteria must be satisfied:

• You have carried out transactions, in significant size, on the relevant market (e.g. stocks, ETFs, or similar products in a Stake or another brokerage or share dealing account) at an average frequency of 10 per quarter over the previous four quarters;
• The size of your financial instrument portfolio, defined as including cash deposits and financial instruments, exceeds €500,000;
• You work or have worked in the financial sector for at least one year in a professional position, which requires knowledge of the products you trade in or want to trade in.

Once your request for such reclassification is received by Stake, we will send you some documentation to review, before we can proceed. Documentary evidence must be provided to confirm your responses to the above. 

You must read carefully and confirm that you understand all the information and warnings provided by us as in general, elective professional clients are afforded a lower level of investor protection and may be treated differently than retail clients. Detailed information on this will be included in the documentation that will be provided.

Additionally, Stake has the right to reject such requests.

For further information on the Elective Professional categorisation, please contact our support team here.