Commodity investment warning to IFAs

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A LACK of understanding of commodity markets among financial advisers could lead to investors buying unsuitable products, the FSA has warned.

The regulator has published a paper outlining the potential risks posed by the growth of the commodities market, which in recent years has seen a wave of new investors piling in to what had once been regarded as a specialist sector. According to the report, the major risk to consumers was from firms developing products with exposure to commodities without full knowledge of the markets and what affects them. A shortage of financial services professionals who understand commodity markets was also cited as a potential issue and could result in consumers buying products they don’t fully u...

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