I don't want to disagree with your main point, but it's wrong to link risk and return so closely, as though one always brings the other. Just because there is

I don't want to disagree with your main point, but it's wrong to link risk and return so closely, as though one always brings the other. Just because there is a lot of risk doesn't mean there will be a lot of return. Risk is simply the likelihood that you will get your original money back, plus any return. The higher the risk, the higher the chance you won't get any return or indeed your original capital. While this often means that people will only take on risky investments if there is a chance of high return, the way it reads is that all you need to do is create some risk and your returns wil flow. It's entirely possible to have high risk, low return and low risk, high return. However I agree entirely that SEC always fights the last war like the French building the Maginot line, and that this type of innovation is just a response to the Sarbox rules.