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Our experts frequently write blog posts about the findings of the research we are conducting.

Displaying 10 out of 37 results

SLCG Research: Average Credit Quality

(Aug 2011)

SLCG released today 'What Does a Mutual Fund's Average Credit Quality Tell Investors?'

Bond mutual funds often report an "average credit quality" in their marketing materials. A fund's average credit quality is represented by a rating (e.g. A, A-) that is based on the credit ratings of the fund's individual securities, and these credit ratings come directly from rating agencies such as Standard and Poor's and Moody's.

In this paper, we explain a methodological flaw in the way average...

SEC Press Release: Structured Products

(Jul 2011)

SEC Staff Issues Summary Report of Sweep Examination of Structured Products Sold to Retail Investors

The Securities and Exchange Commission (SEC) issued a press release today announcing that it had

"issued a report identifying common weaknesses seen in sales of structured securities products and describing measures by broker-dealers to better protect retail investors from fraud and abusive sales practices."

The report is a result of studies in the structured products business of...

SEC Press Release: New Short Form Criteria

(Jul 2011)

SEC Adopts New Short Form Criteria to Replace Credit Ratings

The Securities and Exchange Commission (SEC) issued a press release today announcing that it had removed "credit ratings as eligibility criteria for companies seeking to use 'short form' registration when registering securities for public sale." The SEC unanimously voted for the adoption of this new rule, in response to the Dodd-Frank Wall Street Reform and Consumer Protection Act that encouraged financial regulators to rely...

FINRA Investor Alert: Asking the Right Questions

(Jul 2011)

The Grass Isn't Always Greener-Chasing Return in a Challenging Investment Environment

The Financial Industry Regulatory Authority (FINRA) published an Investor Alert to help retail investors, who are seeking for higher returns through investing in complex securities such as structured products, ask the right questions before making such investment decisions.

Investors are encouraged to read through the FINRA article. The article includes a section on 'Structured Retail Products', since...

In the News: UBS & Morgan Stanley Subpoenaed over Reverse Convertibles

(Jul 2011)

UBS, Morgan Stanley Subpoenaed Over Reverse Convertibles

Bloomberg news reported today that the state of Georgia had sent subpoenas requesting for data and other information from UBS AG, Morgan Stanley and Ameriprise Financial Inc.. The state is investigating whether these brokerage firms violated the securities laws of Georgia in their sale of reverse convertibles to investors of Georgia.

Sales of reverse convertibles have grown, and investors who are being sold these structured...

Dishonest Sales of LEFTs by RBC Capital Markets

(Jul 2011)

Secretary Galvin Charges RBC Capital Markets and Agent with Dishonest Sales of Leveraged and Inverse Leveraged Exchange Traded Funds

The Enforcement Section of the Massachusetts Securities Division of the Office of the Secretary of the Commonwealth alleges that Michael Zukowski, a registered representative of RBC Capital Markets, made "numerous unsuitable recommendations and sales" of leveraged and inverse leveraged exchange traded funds (ETFs) to clients who did not understand the risks...

SEC Press Release: Forex Ponzi Scheme

(Jul 2011)

SEC Charges Forex Ponzi Operator Who Fled After Scheme Unraveled

The U.S. Securities and Exchange Commission (SEC) issued a press release today announcing that it had

"filed fraud charges Thursday against the CEO of a purported foreign currency trading firm, alleging he scammed hundreds of investors with false promises of high, fixed-rate returns while secretly using their money to fund his start-up alternative newspaper."

Lowrance, Chief Executive of First Capital Savings &...

SEC Press Release: State of Municipal Securities Market

(Jul 2011)

SEC Announces July 29 Field Hearing on the State of the Municipal Securities Market

The Securities and Exchange Commission (SEC) issued a press release today announcing that

"it will hold a municipal securities market field hearing in Jefferson County, Ala., on July 29. Topics will include distressed communities, small issuers, disclosure, derivatives and pre-trade price transparency."

The purpose of the field hearing is to understand the relevant issues affecting investors in...

SEC Press Release: Fraudulent Bidding Practices

(Jul 2011)

SEC Charges J. P. Morgan Securities with Fraudulent Bidding Practices Involving Investment of Municipal Bond Proceeds

The U.S. Securities and Exchange Commission (SEC) issued a press release today announcing that it has

"charged J.P. Morgan Securities LLC (JPMS) with fraudulently rigging at least 93 municipal bond reinvestment transactions in 31 states, generating millions of dollars in ill-gotten gains."

Here are the SEC Complaint, SEC Final Judgment and the Litigation Release...

SEC Press Release: Auction Rate Securities

(Jun 2011)

SEC Charges Raymond James for Auction Rate Securities Sales Practices

The U.S. Securities and Exchange Commission (SEC) issued a press release today announcing that it had

"charged Raymond James & Associates Inc. and Raymond James Financial Services Inc. for making inaccurate statements when selling auction rate securities (ARS) to customers."

Here is the SEC's Administrative Proceeding.

According to Registered Rep., Raymond James has agreed to repurchase $300 million of ARS...

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