The Future of Exchange-Traded Notes (ETNs)

Exchange-traded Notes (ETNs) Securities Investigation

Are you concerned about an investment in an exchange-traded note (ETN)? If so, the securities attorneys at The White Law Group may be able to help you by filing a FINRA Dispute Resolution claim.

ETNs are debt instruments issued by banks that can enable investors to make high-risk leveraged bets on investments including stocks, bonds and commodities.

After some negative press in the past couple of years, ETNs have taken a dive with less than 1% of the $4 trillion ETF industry.

Fisher Investments, one of the largest stakeholders in five of the six biggest ETNs, is under fire and its clients have reportedly pulled $3.9 billion, according to Yahoo Finance. Analysts are concerned the ETN market may suffer — potentially losing 100% of their principal.

In 2018 investors suffered catastrophic losses after a spike in the VIX gauge of U.S. stocks volatility (.VIX) sent Credit Suisse VelocityShares Daily Inverse VIX ETN down 84 percent and sales were halted.

Securities regulators have also had their eyes on ETNs, increasing their efforts to regulate nontraditional ETFs and ETNs such as VelocityShares Daily Inverse VIX, and to monitor the manner in which these products are marketed and sold to the investing public.

The Securities and Exchange Commission is reportedly looking for ways to “better differentiate plain vanilla ETFs from leveraged products, which comprise half of ETNs,” according to Yahoo Finance.

The Financial Industry Regulatory Authority has also sanctioned certain broker dealers for unsuitable sales of certain ETNs to retail customers.

ETNs are riskier than securities that have intermediate- or long-term investment objectives, and may not be suitable for investors who plan to hold them for a period other than one day, according to their website.

Recovery of Investment Losses

If you lost money investing in an exchange-traded notes (ETN), the securities attorneys of The White Law Group may be able to help you.  For a free consultation, please call the firm at 888-637-5510.

The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Franklin, Tennessee.

The firm exclusively represents investors in FINRA arbitration claims against their brokerage firm or financial professional.

For more information on The White Law Group, visit https://whitesecuritieslaw.com.