In these days, the derivatives linked securities (DLS) market has experienced gradual growth in Korea. The growth of this market is expected to continue given the still comparatively small size of this market and the expected increase in demand for DLS by both institutional investors and general investors who want to fully diversify their portfolios. However, these complex and complicated products raise important investor protection concerns. Because these kind products often include embedded options, investors could not adequately understand the complicated payoff structure of these products and implicit fees being charged for these products. In addition, these products are not liquid and transparent. The secondary market for most DLS is highly illiquid, which means that investors who want to resell their securities face high transaction costs. However, Capital Market Law regulates these kind product as a securities. To date there are a few complaints of investors who suffering financial losses, it is expected to grow soon. Because most of sales of DLS are principal protected products now, the portion of non-principal protected products are increasing. Capital Market Law should provide a regulatory regime that prevents investors from unknowingly holding inappropriate structured products in their investment portfolios. DLS differs from l traditional investment vehicle such as stock, fund. These products are much more complicated to understand, often relying on complex mathematical formulas and models to determine cash payouts and fees. In addition, it is very difficult to compare with other similar products and it makes average investor to discern the risks and rewards of investments. Several possible regulatory approaches are possible to ensure investor production, this paper proposes to adopt Know-Your-Product Rule in Capital Market Law to reduce the probability that investors hold inappropriate derivative-linked securities.