Articles Tagged with NASDAQ

Investors who are exposed to unscrupulous financial advisors are starting to feel some serious pain. If you have lost a substantial amount of money over the course of the last few months, and your account is on margin, it might get a lot worse.  The good news is, your losses may be recoverable by filing a claim through FINRA Arbitration.

Over the last few weeks the stock market has seen some pretty steep losses.  All major US equity indices, the Dow Jones Industrial Average, the S&P 500, the NASDAQ, and the Russell 2Kare all, as of the date of this post, down at least 10% from their late summer/early fall all-time highs – officially “correction” territory.  Even more disconcerting, all of these indices are now down between 4.4% and 11.5% year-to-date.

What our experience in representing investors in arbitration and litigation for almost twenty years  has taught us is in circumstances like this market, with increased short-term losses spilling into a longer-term trend, like a year-to-date loss, is investors who have been overexposed to excessive trading or churning and margin abuses get hammered hard and fast. The previous seven or eight years has marked a perfect storm for brokers to engage in churning and margin trading without consequences because the markets have largely gone straight up since the spring of 2009, with only minor blips along the road. When investors don’t notice losses in their accounts, they simply are not alerted to what their broker may be doing. If your broker trades too much in your account, this generates commissions which eats away at your return. If the trading is done on margin, that only increases the drag on the account because of margin interest. The higher this Cost-Equity Ratio gets, the more your account has to earn just to may for the broker’s fees and commissions. Margin also can exponentially increase the risk profile of an account. Investors may not notice this wear and tear until the market performance no longer keeps up with the cost of the trading, at which point the losses can accumulate rapidly.

A Deutsche Bank AG unit will pay more than $4 million to settle allegations that it failed to properly report data on millions of options trades, according to the Financial Industry Regulatory Authority (FINRA). The alleged conduct happened between 2010 and 2015 and violated FINRA rules aimed at identifying holders of large options positions who may be trying to manipulate the market or violate other industry rules. NASDAQ and the International Securities Exchange also took part in the investigation. The bank allegedly made enhancements to its reporting systems after hiring an independent consultant to review them.

What is a Master Limited Partnership? (MLP)

A master limited partnership is a limited partnership that is publicly traded on an exchange that combines the tax benefits of a limited partnership with the liquidity of publicly traded securities. There are two types of partners in this type of partnership: The limited partner is the person or group that provides the capital to the MLP and receives periodic income distributions from its cash flow and the general partner is the party responsible for managing the MLP’s affairs and receives compensation that is linked to the performance of the venture. To qualify for the tax benefit, 90% of an MLP’s income must come from activities in real estate, commodities or natural resources such as mining, timber or energy production.

Are MLPs Similar to REITs and How do they Differ?

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