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In Focus #53: 3/19/07


Recent Cases of Customer Abuse by Brokerage Firm Branch Managers Underscore Need for Effective Compliance Function


Fiduciary Focus: Non-Profits Get Their Day (Part 3)


Tale of the Tape


Lessons of the Smith Estate


Annuities: The Good, the Bad and the Ugly


Click here to read more publications by and about James J. Eccleston.
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Alternative | Arbitration | Bonds | Caveat Emptor | Employee Stock Options | Exchange Traded Funds (ETFs) Hedge Funds | Indexes | International | Mutual Funds | Online Brokerage | Real Estate Investment Trusts (REITs) | Payden & Rygel Quarterly Reviews | Settlements | Stocks | Strategies | Tax | Trustee Responsibilities
Trusts | Unit Investment Trusts (UITs) | Variable Annuities | Viaticals

Alternative


A Primer on Alternative Investments and Managed Futures in Particular


Arbitration


The "Sophisticated" Investor Defense to Suitability Claims; More Frequently Raised Than Proven
Behind Closed Doors
Securities Arbitration Awards Highlight Issues Surrounding Hedging Concentrated Stock Positions Resulting From the Exercise of Employee Stock Options
Securities Arbitration Rules to be Modified to Better Ensure Fair Proceedings
Wall Street Meets Madison Avenue; Brokerage Firm Ads Establish New Standards of Conduct
New York Choice of Law Defense Effectively Terminated in Securities Arbitration
2002 Securities Arbitration Review: A Busy Year for Investors Seeking To Recover Their Investment Losses
New York Stock Exchange; An Introduction to Its Arbitration and Mediation Programs
Choosing Mediation to Resolve Your Securities Arbitration Claim
Prohibited Conduct of Stockbrokers
Recovering Your Investment Losses; A Primer On NASD Arbitration
Know The Tricks Of The Churning Analysis
Understand How Elusive Damages Measurements Can Be In Customer Arbitrations
NASD's Arbitration Discovery Guide Clarifies Obligations
Statistics on Customer Complaints, Arbitration and Mediation Show Interesting Developments and Trends
When in Doubt, Disclose: A Primer on Securities Arbitrator Disclosure and Recusal
The Investor's Bill of Rights
Statistics on Customer Complaints, Arbitration and Mediation


Bonds


Muni Trading Gets Real: Current Prices on the Internet
Interest Rate Risk - or - Do Prices Always Go Down When Rates Go Up?
Beware of "High Yield" Bonds
Fixed Income: Should It Have a Place in Today’s Asset Allocation Strategies?
The Surprising Benefits of Rising Interest Rates
How to Shop for Bonds: Pricing Munis on the Internet
Investing In Bonds: 10 Things You Should Know
Investors Should Consider Protecting Their Bond Portfolios
What You Need to Know about Investing in Municipal Bonds
Putting Together a Portfolio of Municipal Bond Investments
New Horizons: Introducing Exchange-Traded Bond Funds
Ladder Up! Laddering a Bond Portfolio Will Substantially Reduce Your Client’s Exposure to Interest Rate Volatility
2000 Ratings Performance Report, courtesy of KennyWeb ( PDF, 1,711K - requires IE)
Municipal Bond Default Report, courtesy of KennyWeb ( PDF, 500K - requires IE)


Caveat Emptor


Recent Cases of Customer Abuse by Brokerage Firm Branch Managers Underscore Need for Effective Compliance Function
Fee-Based Accounts Draw Scrutiny; UBS' Insight One Account Already Subject To Regulatory Action
NYSE Sanction Highlights Remarkable Failure To Supervise Abusive Sales Practices in Customers' Accounts
Investor Fraud Study Reveals Why Investors Are Susceptible
Invest Carefully in Private Equity Funds
Are Structured Products Suitable for Retail Investors?
Know Your Brokerage Firm's Cash Sweep Account
Brokerage Firm's Supervisory Deficiencies Highlight Areas for Investor Concern
Due Diligence Defense: Securities Act of 1933 - Sections 11 and 12(a)(2)
Beware of Financial Advisers Changing Firms; Investors May Pay the Price
Securities Offerings Reform
Seniors Beware: Securities Regulator Details Investment Frauds
Benchmarking Sin
Securities Regulators Announce "Unlucky 13" Investor Traps
New Rule Requires Special Care for Fee Based Brokerage Accounts
Not Your Father’s Utility Stock: When It’s Not Just A Name Change
Fiduciary Responsibility: Liability and Consequences
Ways and Means
Prudent Practices for Investment Fiduciaries
Out-of-Pocket Losses in Exercise and Hold Stock Options Arbitrations
Covered Call Options & Income
The Fallacy of Time Diversification
Making the Grade
"Selling Away"; A Primer for Investors and Their Attorneys
Securities Regulator Issues Warnings Regarding Equity-Indexed Annuities
Volatility Estimates
Value–At-Risk
The Suitability of Exercise and Hold 2.01
Margin Accounts: A Double-Edged Sword
Brokerage Firms Attempt to Clarify the Confusing Roles and Responsibilities of Their Brokers
Regulator Issues Caution Regarding New Products
State Securities Regulators Unveil "Top 10 Threats to Investors"
Know The Risks of OTC Stocks
Stock Investors Soon May Recover Losses from Research Analyst Settlement
NASD's 2004: Investor Protection Efforts Worth Noting
Avoiding Common Investor Problems
NASD Advises How to Understand Stock Analyst Recommendations
Beware of Brokerage Firm Mortgages
Scrutiny of Variable Annuity Sales Practices Intensifies
Don't "Bet the Ranch" By Investing With Mortgage Proceeds
NASD Adds Customer Protections To Arbitration Settlements
The Sector Report
Information Ratio Repair
NASD Discusses Investor Protection Agenda
Equity-Indexed Annuities; Understanding A Complex Product To Protect Investors' Interests
The State of California's Bonds
Beware Of Margin
Many Investors Misunderstand Investments and the Markets, NASD Survey Finds
Margin: A High Risk, Red Flag For Possible Investor Abuse
Continuing Education for Financial Professionals Provides Road Map for Investor Claims To Recover Losses
$2 Million Fine Exposes Conflicts of Interest Between Morgan Stanley Dean Witter and Its Customers
A Must-Read for Investors and Their Lawyers: Book Explains What to Expect, And What Not to Expect, From Financial Advisers
Investor Complaint Statistics Reveal Interesting Trends
Further Information Provided Regarding the Brokerage Firm Analysts' Global Settlement Fund
The Seven Critical Functions and Tasks That Your Financial Adviser Must Perform
CFP Board Sanctions Financial Planners to Protect Investors
Ensure That You Receive Your Mutual Fund "Breakpoint" Discounts
"Brokered CDs"; A Trap for the Unwary
Credit Suisse First Boston (CSFB) Stock Research Is the Subject of Regulator's Complaint For Fraud
Monte Carlo Simulation - Are Your Boots in the Water?
Know That Your Duties to Customers Extend "Beyond the Transaction"
Move Over Merrill Lynch: Salomon Smith Barney Alleged To Have Deceived Investors By Issuing Misleading Research Reports and Stock Ratings
Brokers: Know Your Firm's Asset Allocation and Diversification Recommendations
State Securities Regulators List Unscrupulous Stockbrokers and Research Analysts As Major "Top 10" Investment Scams
Brokerage Firm Ads May Establish Standards for Asset Allocation and Diversification of Your Portfolio
Understanding the Basic Suitability Rules That Financial Advisers Must Honor
Whitepaper on Regulation of Financial Planners (Word, 431K, reprinted with the permission of the Financial Planning Association)
Brokers and Brokerage Firms Really Do Have Ethics and Professionalism Rules
Be Wary of Brokerage Firm Stock Analysts
Tales From the Front: Reasons to Retain Independent Counsel To Protect Your Interests
Don't Overlook Your Obligation to Keep Your Form U-4 Current and Accurate
Assessing and Hedging Risk; A Financial Adviser's Duty
"Alternative Investments": Stockbrokers Must Perform Their "Due Diligence" before They Invest Your Money
Financial Planning Mistakes begin to Blossom; Consider the Bad Advice regarding Employee Stock Options
Securities Regulators Announce "Top 10" Investment Scams
Red Flags To Suspect Stockbroker Abuse
Olde Discount Fined $5 Million As SEC Finds Nationwide Pattern Of Customer Abuse
Don't Let Your Broker Switch You From Fund To Fund Without A Very Good Reason
Beware Of Margin
Tully Report Revived Through NASD's Proposed Salesperson Compensation Rules
An Investor's Checklist For Detecting Stockbroker Abuse
Millennium Prediction: Financial Planning Mistakes Will Blossom
Beware of ERISA Responsibilities
CFP Designation Imposes Responsibilities, Including the Duty to Blow the Whistle on Improprieties
Avoiding The Latest Retail Brokerage Marketing Gimmick: "Fee Based" Compensation
Be Alert for Telephone Calls and Letters from the Brokerage Firm's Branch Office Manager
Don't Overlook Your Brokerage Firm's Clearing Firm In Seeking To Recover Your Investment Losses
Be Wary of "Prime Bank" and Promissory Note Schemes


Employee Stock Options


A LEAPS Primer
The Use of Leveraged Investments to Diversify a Concentrated Position
Optimal Exercise of Employee Stock Options and Securities Arbitrations


Exchange Traded Funds (ETFs)


Securities Regulator Issues Warnings Regarding Exchange Traded Funds (ETFs)
ETFs Finish In First Place
Exchange Traded Funds (ETFs) Are Worth A Look


Hedge Funds


SEC Continues To Seek To Protect Hedge Fund Investors
Securities Regulators Issue New Round of Warnings Regarding Hedge Funds
Hedge Fund Due Diligence; A Must Before You or Your Adviser Invests Your Money
Covered Call Options & Hedging
Optimal Exercise of Employee Stock Options and Securities Arbitrations
Hedge Funds: A Walk Through the Graveyard
Hedge Fund Registration: Risky Business
NASD Alerts Members to Heightened Due Diligence Responsibilities for Hedge Funds and Funds of Hedge Funds
Guidance Regarding Investing in Hedge Funds
Utilizing Hedge Funds in Your Portfolio


Indexes


Equal and Better
Even More MIPY
BIPY for Growth and MIPY for Value
When Three Is not a Crowd or When Three Indexes Are Better than One
Making the Most of the Middle
The Middle Child
Wind Shift or Sea Change?
A Timely Look at Living Wills
Regression to the Mean
Actively Passive? The Discussion Continues
Actively Passive? A Deeper Look
Actively Passive? A Longer Look
Actively Passive?
Obscured by an Index
Reconcilable Differences
S&P 500 Indexing Is Not A Broad Market Play; Some Alternatives To Consider
On The Wrong Track (Tracking Errors Among the Major Indexes)
One Market, Many Performances
Bias in the Benchmarks
Enhanced Index Funds or In Need of Enhancement?
Looking Beyond the Indexes


International


Investing Beyond Our Shores
Asian Turmoil And Its Impact Upon Global Markets


Mutual Funds


Economies of Scale?
Alpha Goes International
What's in a REIT Fund?
Alpha Stability
Alpha in the Box
Right on Target?
Evening the Odds
So Many Mutual Funds, So Little Time: How to Choose and Evaluate Mutual Funds
Hidden Measures
Thinking Inside the Box
Minimum-ism
Benchmark Checkup
Survival of the Fittest
The Virtues of Consistency
Now You See It…
Standards of Greatness
In the Eye of the Evaluator: Morningstar vs Value Line
Stocks versus Funds
Style Drift (still) Happens
Serving Two Masters Can Cost Investors Plenty
When Less is More (What is the Value of a Mutual Fund Manager's Tenure?)
The Fund Funnel
Customers Who Take Action May Receive Refunds For Mutual Fund Commission Overcharges
The Tech Wreck
Recent Decisions
Loaded Down
Mutual Fund Cost Factors: Benchmarking Change
The Third Way
It's in the Stars
Starry Eyed
Are Two Heads Better?
For Bear Market Protection Advisers Should Consider These Mutual Funds
Best in Show
Sharpe and to the Point
Be Alert for Mutual Funds Charging High Fund Expenses
The Alpha Advantage
Safety in Numbers
The Great Migration
April Month-End Summary: Turnaround or Temporary Relief?
Survivor: Fund Liquidations in 2001
Leveraged Mutual Funds Pose Greater Risks
Mutual Funds To Avoid If You Don't Want Roller Coaster Returns
SEC Declares War On Corporate "Earnings Management"
When Less is More (What is the Value of a Mutual Fund Manager's Tenure?)
January Month-End Summary: The New Year Takes Off on a Higher Note
Is Bigger Better? Analysis of Funds’ Size and Performance
February Month-End Summary: It's Not Over Yet
March Month-End Summary
Serving Two Masters Can Cost Investors Plenty


Online Brokerage


A Great Investment Tool: The Internet
Online Trading Introduces a New Chapter in Customer Complaints
Tips for the On-line Investor
SEC Evaluates Online Brokerage Firms


Real Estate Investment Trusts (REITs)


NAREIT Research Report: Investing In Real Estate Trusts (PDF, 581K)


Payden & Rygel Quarterly Reviews


Payden & Rygel Quarterly Review - Q2 2002 (PDF, 319K)
Payden & Rygel Quarterly Review - Q1 2002 (PDF, 592K)


Settlements


Investors Should Consult the Independent Stock Research Now Available
Court Approves Global Settlement for Investors to Recover Losses from Brokerage Firms
SEC Global Settlement — 2003
Suggestions To Address Customer Concerns Raised by the $1.4 Billion Global Settlement


Stocks


Of Stocks and Funds
Understanding the Role of the Brokerage Firm Research Analyst
Study Shows That "Everyone" Did Not Lose Money in the Recent "Bear Market"
Basket Case
Protecting Yourself From Small Stock Fraud
Buying Highflying Stocks on Margin; An Explosive Combination That Some Firms Now Restrict
25 Stocks To Avoid In A Down Market
Beware of Companies that Accept "Toxic Convert" Financing


Strategies


Morningstar's New Metric: "Investor Return"
Securities Regulator Provides Helpful Guidance As to Asset Allocation, Diversification and Rebalancing
Commodities: A Case for Active Management
Thinking Inside the Box
Keeping It In Perspective
Rebalancing Act
Standard Deviation, Sigma or s
Beta, ß
An Auspicious Time for Private Foundations?
Asset Allocation in the Long and the Short Run
Skewness and Kurtosis – Moving beyond Volatility
Everything You Wanted to Know About Equity Performance Benchmarks
Margin Accounts: A Double-Edged Sword
The Proxy Edge: Exercising Your Shareholder Rights
Monte Carlo Analysis - A Tool for Evaluating Investment Returns
Portfolio Management Processes To Achieve Goals and Manage Risk Highlighted in Comptroller's Handbook
Information Ratio - What Is It and Why Is It Important?
The Effect of Options on Portfolio Risk - Part 2
The Effect of Options on Portfolio Risk
Churning Revisited: Trading Costs and Control
The Use of Leveraged Investments to Diversify a Concentrated Position
The Well-Traveled Portfolio
The Future Is Now
Exchanging Views
Is There Value in Growth?
The 10 Fundamental Axioms for Effective Retirement Investing
The Key to Investment Success
Sharpening the Sharpe Ratio
They Shoot, They SCR
Dissecting the Decline
Remedies for Concentrated Portfolios (PDF, 2,064K)
Index Funds: Made from Concentrate
Live Long and Prosper! (Part 3 of 3)
New Study Shows Investors' Portfolios Are Under-Diversified
The Secret Formula (Part 2 of 3)
Right Road, Wrong Map (Part 1 of 3)
Rebalance of Power
Relative Concerns
Asset Allocation: Prudent Investing Requires It
The Mid Cap Gap: Filling in the Missing Piece of the Asset Allocation Pie
Asset Allocation: The Re-Balancing Act
Staying Cool On The Hot Trends; A Disciplined Approach To Investment Success
Hedging Against Market Losses
Smart Investing In 1997; Short Theory Revisited
Bull Market Or Bear Market, Measure Your Exposure To Loss
This Year's Top Performing Mutual Funds Probably Won't Be Next Year's Top Performers
Finding The Best Mutual Fund Concentrating In Technology Stocks
Concentrated Mutual Funds: Probably Not A Wise Choice


Tax


The Alternative Minimum Tax: Coming to a Tax Return Near You
The Expanding Reach of the Alternative Minimum Tax
Back to Basis
Mutual Fund Tax Efficiency
The Double Whammy: Record Tax Distributions in 2000


Trustee Responsibilities


New Issues in Trustee Fiduciary Procedural Prudence
The Effect of Uniform Laws on Trustee Investment


Trusts


Investment Planning for Fiduciaries; An Overview of the Laws That Have Governed Private Trusts
Climbing Mount Everest; Or, The Difficulty Trustees Face In Proving Ratification of Imprudent Investment Decisions
Trustees Must Be Wary of Concentrated Asset Positions


Unit Investment Trusts (UITs)


Consider Investing In Unit Investment Trusts


Variable Annuities


Beware of the Exchange of Life Insurance Policies and Annuity Products
An Overview of Equity-Indexed Annuities
Variable Annuities #2: Guaranteed Minimum Death Benefits Are Not Much Benefit
Variable Annuities #1: Tax Deferral Can Make You Poorer!
Equity-Indexed Annuities: Toxic Investments
Annuities
Variable Annuity Sub-Accounts; a Black Hole Dangerous To Investors
Annuity Investing & Proper Contract Structuring Considerations
Regulation of Variable Contracts
SEC Cautions Against Purchasing Variable Annuities


Viaticals


"Disreputable" Viatical Investments

   
 
 
 
 



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Sponsored by James J. Eccleston, an attorney representing stockbrokers, financial planners and investors nationwide in arbitration, litigation and regulatory matters, and a shareholder with the law firm Shaheen, Novoselsky, Staat, Filipowski & Eccleston P.C.(www.snsfe-law.com). This Web site contains material of general interest. It is neither intended to, nor constitutes, either legal advice or investment advice. Always consult an attorney and/or investment advisor when building and protecting your wealth.

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