Investors Getting Burned by Complex Securities
The Wall Street Journal has published a story on how investors have been burned by complex securities in the recent volatility in the stock markets. These securities may take the form of supposed “Certificates of Deposit” or “Notes”, that give the appearance of secure debt investments, but which, in actuality, are highly leveraged investments tied to stock market indices and to complex algorithms tied to the differential between various interest rate differentials. Institutional investors largely avoid these types of investments, so unscrupulous brokers have foisted them on trusting individual clients. Most such brokers did not fully understand the nature and risks of these investments, and accordingly, failed to fulfill their legal obligation to recommend only investments that are suitable for their clients needs. Our firm is representing investors who have seen their savings destroyed by these sorts of investments. Read more here.
