MiFID requires the banks to classify all their clients and to notify those clients as to which investor category they belong to.
MiFID defines three categories of investor:
- Retail clients
- Professional clients
- Eligible counterparties.
The bar is set exceptionally high for classification as a professional client (chiefly government agencies, institutional investors and large corporations) and so the majority of our clients will be categorised as retail clients. That's actually great news for investors, as it is precisely this category of client that enjoys the highest possible level of protection.