Did your stockbroker mishandle your investments through trading in credit default swaps? A credit default swap (CDS) is a contract in which the holder of a fixed-income security transfers the risk of default of that security to the seller of the swap.
The buyer of the CDS makes a series of payments to the protection seller and, in exchange, receives a payoff if a credit instrument (typically a bond or loan) goes into default. In other words, the buyer of a credit swap receives credit protection, whereas the seller of the swap guarantees the creditworthiness of the debtor.
For example, the buyer of a credit swap will be entitled to the par value of the bond by the seller of the swap, should the bond default on its coupon payments.
Losses as Result of Credit Default Swaps
Did your stockbroker mishandle your investments by trading in credit default swap contracts on your behalf, resulting in unjustified losses in your investment portfolio? Unfortunately, some stockbrokers and some brokerage firms fail to perform due diligence in assessing the risks associated with a given structured product, such as a credit default swap. They may misrepresent the product and the risks involved and mislead their clients into making unsuitable investments. If you lost money after investing in a credit default swap, contact a New york City, Los Angeles, Miami or West Palm Beach credit default swaps lawyer at the law offices of Dimond Kaplan & Rothstein, P.A.
Consult a Securities Arbitration Lawyer
Dimond Kaplan & Rothstein, P.A., is AV-rated* and recognized as a “Top Law Firm” in theSouth Florida Legal Guide in 2006, 2007, 2008 and 2009. Our law firm represents investors throughout the state, the nation and the world in stockbroker misconduct cases. We represent investors in arbitration and bring class action litigation.