Dimond Kaplan & Rothstein currently represents investors who lost money in UBS’s so-called “Yield Enhancement Strategy.”  This was an options strategy that was marketed as a safe way to enhance the yield (or income) on investments. But investors have suffered unexpected investment losses in this supposedly safe strategy.

In this case, UBS represented to investors that its Yield Enhancement Strategy provided a low-risk way to provide investors with additional income. In reality, the strategy was fraught with risk that ultimately led to investor losses.

Have You Lost Money Investing with UBS Yield Enhancement Strategy?

If you lost money investing with UBS and the Yield Enhancement Strategy contact an experienced investment fraud attorney at Dimond Kaplan & Rothstein, P.A. today.

UBS YES Yield Enhancement Strategy Risky in Volatile Market

Despite the risks of options investing, brokerage firms like UBS sometimes claim that they can devise a low-risk strategy using these types of risky securities. The UBS Yield Enhancement Strategy was marketed to investors as a way to increase the yield on their investments, providing them with additional income. In reality, the strategy was fraught with risk and many investors, unaware of the full risks, were misled. 

How a UBS Yield Enhancement Strategy Works

The Yield Enhancement Strategy involved a complex “iron condor” options strategy involving buying and selling both puts and calls on the S&P 500.

An iron condor is an options strategy that entails writing a series of options, typically all at once or around the same time.  The iron condor structure entails writing two near money options that are short, in addition to purchasing two deeper out-of-the money options that are long.  The first component of an iron condor involves selling an out-of-the money put (short put), while simultaneously selling an out-of-the money call (short call).  

Volatile Markets Create Risk for Unknowing Investors

The UBS Yield Enhancement Strategy arguably would function as it was marketed as long as there was very little market volatility. But when the stock market is volatile, with large and rapid increases and decreases, the strategy can cause significant investment losses.

As a result of recent market spikes and declines, many investors have experienced considerable losses in the UBS Yield Enhancement strategy.

Unfortunately, this investment strategy was unsuitably risky for some investors and some brokers who recommended the strategy failed to make adequate risk disclosures to investors.

Investors May Have a Claim to Recover Their Yield Enhancement Losses

Back in 2013, a Credit Suisse client filed a FINRA arbitration case to recover losses suffered in a yield enhancement strategy. According to publicly available records, “financial advisors at Credit Suisse Securities (USA) LLC recommended that [the client] allocate a significant portion of his retirement funds in a high-fee proprietary strategy called the “Yield Enhancement Strategy” or “YES” without considering [the investor’s] stated investment objectives or properly explaining the risks of the strategy.”

Investors May Have a Claim for UBS Yield Enhancement Strategy Loss

We believe that investors who have sustained losses in the UBS Yield Enhancement Strategy may be able to recover their losses through a FINRA arbitration claim.  If you lost money in the UBS Yield Enhancement Strategy you should seek the advice of a lawyer who has experience representing investors in investment fraud and broker negligence cases to discuss their rights.

Speak with an Investment Fraud Attorney

Dimond Kaplan & Rothstein, P.A. has vast experience in representing investors who have sustained losses due to the negligence or misconduct of their broker and/or brokerage firm, including cases involving complex options strategies. We will aggressively pursue claims against UBS to recover your Yield Enhancement Strategy investment losses.

If you are looking for an investment fraud attorney to review your rights and options, the investment fraud lawyers at Dimond Kaplan & Rothstein, P.A. represent individual and institutional investors who have lost money as a result of investment fraud or stockbroker misconduct. We’ve recovered more than $100 million in assets lost to investment fraud and stockbroker misconduct.

Contact Dimond Kaplan & Rothstein Today

Contact an investment fraud attorney at Dimond Kaplan & Rothstein, P.A. to schedule an appointment for a FREE case evaluation.

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