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

Displaying 71-80 out of 228 results for "Principal Protected Notes".

FDIC Goes After Directors of Failed Banks

(Sep 2013)

In recent months, the Federal Deposit Insurance Corporation (FDIC) has been filing a significant number of lawsuits against bank executives to recoup losses stemming from the onslaught of bank failures following the financial crisis. The annual number of bank failures reached a peak at 157 in 2010 and has declined steadily since.

These bank failures were a significant test of the FDIC system. The fund backing the FDIC guarantee has been depleted by nearly $90 billion over the past five years...

SEC Litigation Releases: Week in Review - September 13th, 2013

(Sep 2013)

SEC Charges Atlanta-Based Investment Adviser Representative with Securities Fraud
September 12, 2013, (Litigation Release No. 22797)
Earlier this week, the SEC chargedPaul Marshall, Bridge Securities, LLC, Bridge Equity, Inc. and FOGFuels, Inc. with misappropriation of client funds as well as violations of Securities Exchange Act of 1934, the Securities Act of 1933 and the Investment Advisers Act of 1940. The SEC alleges that over the past two years, Marshall has misappropriated "at least $2...

Illiquid ETFs and SEC Market Maker Incentives

(Sep 2013)

There is now nearly $1.5 trillion invested in exchange-traded products (ETPs) in some 1,400 exchange-traded funds and exchange-traded notes. However, not all of that huge sum is distributed evenly. Some funds, like SPY, have huge assets under management, while many others struggle to top $10 million. Often, issuers will close lightly-traded ETPs (leading to substantial turnover each year), but if they don't, the market price of an ETP can often deviate from the net asset value of its...

SEC Litigation Releases: Week in Review - August 30th, 2013

(Aug 2013)

SEC Charges Oklahoma Investment Adviser and Cohort with Fraud
August 27, 2013, (Litigation Release No. 22789)
According to the complaint, former investment adviser Larry J. Dearman, Sr. "invested his clients in various businesses that" his close friend, Marya Gray, "owned in Bartlesville, Oklahoma." According to the SEC, Dearman and Gray misled investors "about the safety of the investments and how their funds would be used, telling them, for instance, that investor funds would be used to...

Regulators Soften on Credit Risk Retention Rule

(Aug 2013)

Yesterday financial regulators proposed a revised rule addressing the retention of credit risk for sponsors of securitizations -- see the proposed rule .¹The thought is that by removing the separation between the origination and securitization of loans, lenders will focus more on the quality of loans rather than the quantity, as they would have to keep some 'skin in the game' when structuring asset-backed securities.

The original March 2011 proposal required securitizers to retain at least...

SEC Litigation Releases: Week in Review - August 23rd, 2013

(Aug 2013)

SEC Settles Claims Against Ebrahim Shabudin Arising from Understated Bank Losses During Financial Crisis
August 22, 2013, (Litigation Release No. 22786)
Earlier this month, the SEC's claims against Ebrahim Shabudin (the former Chief Operating Officer of UCBH Holdings, Inc.) were settled. The SEC "alleges Mr. Shabudin and other defendants concealed losses on loans and other assets from the bank's auditors and delayed the proper reporting of those losses." To settle the charges, Shabudin has...

Do Leveraged ETFs Increase Stock Market Volatility?

(Aug 2013)

Leveraged exchange-traded funds (LETFs) are controversial investments. Because they can be leveraged as much as 3x, and can be linked to highly volatile underlying assets, their daily price movement is typically very dramatic. Also, LETFs tend to lose value over time if their underlying assets are relatively volatile due to rebalancing effects, something we've covered in our blog post "Leveraged ETFs", as well as in our research papers, "Leveraged ETFs, Holding Periods and Investment...

Structured CD with an Exotic Embedded Option

(Aug 2013)

In the past few months, we have constructed a database of thousands of structured certificates of deposit (CDs). We have analyzed and evaluated hundreds of these CDs and have compiled these results into a recently completed study . Our results indicate that structured CDs are usually issued at significant discounts to face-value (comparable to structured products), offer little if any market exposure and are often less valuable than contemporaneously issued fixed rate CDs.

We've recently come...

SEC Litigation Releases: Week in Review - August 9th, 2013

(Aug 2013)

SEC Obtains Asset Freeze and Other Relief in $4 Million Offering Fraud
August 8, 2013, (Litigation Release No. 22774)
According to the complaint, Steven B. Heinz and his company S.B. Heinz & Associates, Inc. orchestrated an offering fraud and $4 million Ponzi scheme since January of 2012. According to the complaint, "Heinz [paid] 'returns' to earlier investors using new investor funds, used investor funds for his own personal purposes and...S.B. Heinz used investor funds to pay business...

MSRB Proposes Rule on Muni Bond Markups

(Aug 2013)

Our colleagues' recent paper on municipal bond markups, which showed that retail investors were charged nearly $11 billion in markups from 2005-2013, has generated a lot of attention. In June we spent an entire week covering the background, methodology, findings, and implications of that paper, which we think has important implications for the municipal bond investors.

On Tuesday, the Municipal Securities Rulemaking Board (MSRB) proposed a new "fair-pricing" rulethat could help address the...

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