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D. Daxton White
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The White Law Group is a national securities fraud, securities arbitration, investor protection and securities regulatory/compliance law firm with offices in Chicago, Illinois and Boca Raton, Florida. We pride ourselves on providing quality legal services to our clients and handle securities... More
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The White Law Group's Securities Fraud Blog
  • Recovery Of Inverse ETF Losses 0 comments
    Mar 25, 2014 10:12 AM

    Have you suffered losses in an inverse ETF? To the extent that you purchased the investment at the recommendation of a financial advisor, the securities attorneys of The White Law Group may be able to help you recover your losses through a FINRA arbitration claim.

    An inverse ETF is an exchange-traded fund (ETF) that is constructed by using various derivatives for the purpose of profiting from a decline in the value of an underlying benchmark. Investing in these ETFs is similar to holding various short positions, or using a combination of advanced investment strategies to profit from falling prices. They are also known as a "Short ETFs," or "Bear ETFs."

    Unfortunately, many investors confuse these investments with traditional ETFs that simply attempt to track a particular index - thereby believing that the investments are relatively safe. More troubling is that some financial advisors either do not know the difference or fail to explain the difference between traditional ETFs and inverse ETFs (particularly with respect to how the investments react to market movements and the increased risk of the derivatives trading necessary to profit from a decline in the underlying benchmark of the inverse ETF).

    If a financial advisor fails to adequately explain the risks of an investment or recommends an investment unsuitably, that advisor (or his/her broker-dealer) may be held responsible for any investment losses.

    With the recent bull market, many inverse ETFs have suffered enormous losses, including but not limited to:

    KOLD - ProShares UltraShort DJ-UBS Natural Gas

    DUST - Direxion Daily Gold Miners Bear 3X Shrs

    *BIS - ProShares UltraShort Nasdaq Biotech

    *SOXS - Direxion Daily Semicondct Bear 3X Shares

    DRV - Direxion Daily Real Estate Bear 3X Shrs

    *FINZ - ProShares UltraPro Short Financials

    *RXD - ProShares UltraShort Health Care

    SRS - ProShares UltraShort Real Estate

    *TZA - Direxion Daily Small Cap Bear 3X Shares

    SSG - ProShares UltraShort Semiconductors

    *SRTY - ProShares UltraPro Short Russell2000

    SDP - ProShares UltraShort Utilities

    *BXDB - Barclays Short B Lvgd Inv S&P 500 TR ETN

    *MIDZ - Direxion Daily Mid Cap Bear 3X Shares

    *SMDD - ProShares UltraPro Short MidCap400

    *SQQQ - ProShares UltraPro Short QQQ

    SJL - ProShares UltraShort Russell MidCap Val

    SKK - ProShares UltraShort Russell2000 Growth

    SDK - ProShares UltraShort Russell MCap Growth

    The White Law Group continues to investigate the liability that brokerage firm's may have for improperly selling such investments. For information on the firm's investigation, visit http://www.whitesecuritieslaw.com/2012/05/07/recovery-of-inverse-etf-and-etn-investment-losses/.

    If you suffered losses in an inverse ETF recommended to you by your financial advisor, please call the securities attorneys of The White Law group at 312/238-9650 for a free consultation.

    The White Law Group is a national securities fraud, securities arbitration, and investor protection law firm with offices in Chicago, Illinois and Boca Raton, Florida.

    For more information on The White Law Group, visit www.whitesecuritieslaw.com.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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