CISI Professional Practice Exam 2025 – Complete Prep Guide

MiFID, which stands for the Markets in Financial Instruments Directive, aims to enhance transparency and investor protection within the financial markets. This regulatory framework was introduced by the European Union to create a more integrated and efficient financial market, fostering a higher standard of conduct among financial firms.

In terms of transparency, MiFID mandates firms to disclose more detailed information about their operations, prices, services, and risks, thereby allowing investors to make more informed decisions. This increase in information availability helps to level the playing field between retail investors and institutional investors, promoting fairer competition.

Moreover, MiFID places a strong emphasis on investor protection by imposing strict obligations on financial service providers. It requires them to act in the best interest of their clients and ensures that investors receive adequate information about the products they are purchasing. This includes enhanced suitability assessments and the provision of clear, comprehensible information regarding potential risks.

Overall, MiFID significantly contributes to a more transparent environment while safeguarding investor interests, fostering trust in financial markets, and ultimately leading to a more robust investment landscape.