Structured products are not suitable for most retail investors
HOUSTON, August 22, 2022 /PRNewswire/ — Shepherd Smith Edwards and Kantas (investorlawyers.com) are investigating loss claims involving JPMorgan Chase’s callable contingent interest notes linked to the S&P GSCI® Crude Oil Index Excess (SPGCCLP).
What is a Callable Contingent Interest Note?
It is a complex structured product which is generally an investment vehicle based on a single security, index, commodity, debt issue, foreign currency or basket of securities.
Structured products with a fixed maturity date are intended to offer risk-return trade-offs that create a predefined formula for possible risks and returns. However, this type of investment is not suitable for most retail investors. Yet financial companies, such as JPMorgan Chase, have created self-redeemable notes and sold them to retail customers who lack the investment experience or risk tolerance level to handle the losses that may result.
JPMorgan brokers may have misrepresented the risks
If an investment product and its risks are difficult to explain to an investor, let alone understand for the investor, then the more a financial adviser should do to ensure that they are explaining that product in a way that is understandable to a customer. Unfortunately, investors who bought JPMorgan Chase Auto Callable Contingent Interest Notes related to Surplus of the S&P GSCI® Crude Oil Index might not have been informed of all the risks. This is why many of them did not expect to suffer major losses when COVID-19 and the other adverse events that followed strongly impacted oil prices and their investments.
Your dealer has a duty to ensure that its registered representatives perform the necessary due diligence to both fully understand any financial instrument they recommend to a client and to ensure that it is suitable for the client based on their objectives. investment and its specific risks. tolerance level. Losses resulting from the negligence of a brokerage firm may warrant a request for arbitration from the Financial Industry Regulatory Authority (FINRA) for damages.
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