Because of the attention received by the solar power industry, many brokers and financial advisers recommended the Market Vectors Solar Energy ETF to their clients. However, as a result of budget crises in Europe, subsides that were badly needed to develop solar technology were reduced or eliminated. As a result, technological advancements that would have made solar power economically viable did not materialize as expected. Reportedly, the Market Vectors Solar Energy ETF is down 67 percent, which is bad news for many investors. Luckily, investors who suffered significant losses can consult with a securities fraud attorney to see if they may have a valid securities arbitration claim.
Brokers, as well as brokerage firms, have a fiduciary duty to their clients. They must research an investment prior to making a recommendation to an investor in order to establish that the investment is suitable. It must be appropriate for each individual investor, taking into consideration the investor’s investment objectives, investment experience, net worth and age. The Financial Industry Regulatory Authority has a dispute resolution form where investors and their investment fraud lawyers can settle disputes with their brokerage firms relating to unsuitability and other forms of stock broker fraud.
Brokers have been known to sell ETFs and ETNs as conservative ways to track a sector of the market or the market as a whole. However, complicated trading strategies are necessary to accomplish this, and using these investments to track a sector of the market may or may not be a conservative trading strategy. This depends on the sector of the market and assets in the account relative to the investment’s concentration level.
Broker misconduct has occurred if the broker in charge of the account made an unsuitable recommendation or took an unnecessarily risky position in the ETN or ETF. If you suffered significant financial losses as a result of the unnecessary risks of your broker, you may have a valid securities arbitration claim. To find out more about your legal rights and options, contact an investment fraud laywer at The Law Office of Christopher J. Gray at (866) 966-9598 for a no-cost, confidential consultation.