The PRIIPS regulation, which stands for Packaged Retail Investment and Insurance Products, was developed with the aim of providing non-professional investors with clear and understandable information about financial products.
This regulation aims to protect non-professional investors by giving them access to understandable and transparent information on financial products so that they can make informed decisions about their investments. Non-professional investors are often less experienced and may need more protection when making financial decisions, and the PRIIPS regulations aims to address this.
These regulations require financial institutions to provide non-professional investors with standardized documents, the Key Information Document (KID), which contains important information about the product, such as risks, costs, and returns. The PRIIPS Regulation aims to promote transparency and comparability so that non-professional investors can make informed decisions about their investments and insurance products.
A mandatory standardized document that provides essential information to non-professional investors about financial products, including risks, costs, and returns.
The regulations require all KIDs to be presented in a standardized manner so that non-professional investors can easily understand and compare the information.
KIDs should include a risk indicator that indicates the level of risk of the product, ranging from low to high, to help non-professional investors assess the risk of the product.
KIDs should include detailed information on the cost of the product, including both direct and indirect costs, so that non-professional investors can get a clear picture of the total costs.
The KIDs may also include information about potential returns from the product, based on different scenarios, to help non-professional investors better understand the potential financial outcomes.
By combining these elements, the PRIIPS regulation aims to promote transparency and comparability, allowing non-professional investors to make more informed decisions about their investments.
