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

Displaying 121-130 out of 216 results for "JOBS Act".

Welcome to Muni Markup Week on the SLCG Blog

(Jun 2013)

Today SLCG posted a new working paper titled "Using EMMA to Assess Municipal Bond Markups". In it, our colleagues Geng Deng and Craig McCann report a veritable pandemic of excessive markups charged to retail investors in the municipal bond market. This work has been highlighted in a recent Wall Street Journal article by Jason Zweig. Jason's looked at markups generically in the past and we're happy this story has caught his attention.

The primary findings of the paper are that:

Municipal bond...

SEC Warns Investors About Binary Options

(Jun 2013)

The SEC has issued an Investor Alert on binary options, which are derivatives that pay out a fixed amount if an event happens and zero if it does not. We've covered binary options before, so do check out that post for a detailed background and an Excel spreadsheet that explains how binary options work in some detail.

The Alert highlights several risks of binary options, mostly relating to how they are traded. It notes:

Much of the binary options market operates through Internet-based trading...

SEC Commissioners Vote Unanimously on Money-Market Reform Measures

(Jun 2013)

The SEC voted on Wednesday on changes to rules governing money market funds (MMFs). As we discussed on Tuesday, MMFs are considered low risk, low return investments similar to bank accounts, but experienced 'runs' during the financial collapse of 2008 that helped freeze financial markets. The SEC's new rules hope to prevent such runs by changing how MMFs report their assets.

As widely suspected, the changes target MMFs favored by large institutional investors (dubbed 'prime funds'). While...

SEC Litigation Releases: Week in Review - June 7th, 2013

(Jun 2013)

Final Judgments Entered Against Former Nicor Senior Officers Kathleen Halloran and George Behrens
June 5, 2013, (Litigation Release No. 22715)
Final judgments were entered against Kathleen Halloran and George Behrens, former CFO and former Treasurer of Nicor, Inc. respectively, for allegedly overstating "Nicor's financial performance...by, among other things, making or authorizing false and misleading statements about Nicor's performance in multiple filings with the Commission." The SEC...

Dodging Hedge Fund Requirements: The Case of Mariner Access

(Jun 2013)

Nowadays, there are several ways that retail investors can purchase risky investments which would typically be considered unsuitable. For example, many exchange-traded funds (ETFs) use derivatives to offer investors access to risky asset classes (such as CDOs) or complex options positions (such as covered calls). Since ETFs can be bought and sold like any other listed stock, essentially any investor can now take covered call positions regardless of her understanding of options. There is even...

FINRA Fines Wells Fargo and Banc of America Over Unsuitable Sales of Floating-Rate Bank Loan Funds

(Jun 2013)

Yesterday, the Financial Industry Regulatory Authority (FINRA) announced fines totalling more than $2.1 million levied against Wells Fargo and Banc of America. In addition, FINRA has ordered the two institutions to pay restitution in excess $3 million to customers who suffered "losses incurred from unsuitable sales of floating-rate bank loan funds."

A floating-rate bank loan fund is a mutual fund that mainly invests in floating-rate high-yield senior secured loans. The floating-rate on the...

SEC to Vote on New Money Market Fund Rules

(Jun 2013)

Tomorrow, the Securities and Exchange Commission will vote on new rules pertaining to the $2.6 trillion money market fund (MMF) industry. The SEC hopes that the new rules will safegaurd against future runs on MMFs, such as those that occurred during the financial crisis after the collapse of Lehman Brothers. A "run on" MMFs occurs when many investors (or a few very large investors) attempt to redeem their shares in near unison, resulting in significant liquidations of MMF holdings.

A money...

Investors Bristle at New Structured Product Valuations

(Jun 2013)

Back in February, the SEC issued a letter to structured product issuers that required them to estimate and prominently state the estimated value of the notes to investors. According to Risk.net, as issuers have begun doing so, many investors have "expressed surprise" at how low those valuations are.

However, these valuations should be no surprise to anyone familiar with the structured product literature, which has documented significant discounts for a wide variety of product types. You can...

SEC Litigation Releases: Week in Review - May 31st, 2013

(May 2013)

District Court Enters Judgment Against Medical Software Company and Its CEO and CFO
May 30, 2013, (Litigation Release No. 22709)
Default judgments were entered against MedLink International, Inc., its CEO, Aurelio Vuono, and its CFO, James Rose, for allegedly "filing an annual report falsely stating that its audit had been completed and...defrauding a MedLink investor." The judgment orders permanent injunctions from violating sections of the Securities Act and Exchange Act and orders the...

Risks of Mortgage REITs

(May 2013)

Instead of investing in real estate property directly like equity real estate investment trusts (REITs) do, mortgage REITs borrow in the repo markets and invest in mortgage backed securities (MBS) -- mostly residential MBS issued by Fannie Mae, Freddie Mac, and Ginnie Mae. The current environment of low interest rates has kept the borrowing costs low for mortgage REITs, facilitating their outstanding growth. The figure shows the market capitalization for all listed mortgage REITs and the...

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