Did you lose money investing in VelocityShares 3x Long Natural Gas ETN Linked to the S&P GSCI Natural Gas Index ER (UGAZ)?
Galvin Legal, PLLC is launching an investigation on behalf of investors who suffered losses investing in VelocityShares 3x Long Natural Gas ETN Linked to the S&P GSCI Natural Gas Index ER (UGAZ) at the recommendation of their financial advisor. If you suffered losses investing in the investment, then Galvin Legal, PLLC may be able to help you recover your losses in a Financial Industry Regulatory Authority (“FINRA“) arbitration claim against the brokerage firm that recommended the investment.
As energy prices have declined so has the value of energy investments. Many investors have suffered significant losses in energy investments that were recommended to them by the financial advisor. Many of these investments were high risk and were unsuitable for their portfolios.
If you suffered losses and would like a free consultation with a securities attorney, then please call Galvin Legal, PLLC at 1-800-405-5117.
About the Investment: VelocityShares 3x Long Natural Gas ETN Linked to the S&P GSCI Natural Gas Index ER (UGAZ)
According to the pricing supplement dated April 17, 2020 (the “Pricing Supplement”), VelocityShares 3x Long Natural Gas ETN Linked to the S&P GSCI Natural Gas Index ER (UGAZ) is a Leveraged Long Exchanged Traded Note (“ETN”) that is issued by Credit Suisse AG. Credit Suisse AG also issued a Leveraged Inverse ETN, VelocityShares 3x Inverse Natural Gas ETN Linked to the S&P GSCI Natural Gas Index ER (DGAZ). The ETNs are senior medium-term notes of Credit Suisse AG, maturing February 9, 2032 unless the maturity of any series of ETNs is extended. The ETNs are designed for investors who seek leveraged long or leveraged inverse exposure, as applicable, to the Index. The ETNs do not guarantee any return of principal and do not pay any interest during the term.
The Pricing Supplement further warns that the ETNs are not intended to be “buy and hold” investments. Instead, the ETNs are intended to be daily trading tools for traders and similarly sophisticated investors to express short-term market views and manage daily trading risks. The ETNs are designed to achieve their stated investment objectives on a daily basis and, therefore, their performance over different periods of time can differ significantly from their stated daily objectives. The ETNs are considerably 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 of more than one day. Investors should actively and frequently monitor their investments in the ETNs on a daily or intraday basis, and any decision to hold the ETNs for more than one day should be made with great care and only as the result of a series of daily (or more frequent) investment decisions to remain invested in the ETNs for the next one-day period. If you hold the ETNs for more than one day, it is possible that you will suffer significant losses in the ETNs even if the performance of the Index (as defined below) over the time you hold the ETNs is positive, in the case of the 3x Long Natural Gas ETNs, or negative, in the case of the 3x Inverse Natural Gas ETNs. Accordingly, the ETNs should be purchased only by sophisticated investors who understand the Index and the consequences of investing in the ETNs that are designed to provide exposure to three times (3x) or negative three times (-3x), as applicable, the daily performance of the Index. The ETNs do not provide direct exposure to the spot prices of natural gas. Because the Index is composed of natural gas commodities futures contracts and does not track the spot price of natural gas, the Index and, in turn, the ETNs can be expected to perform very differently from such spot price.
If you suffered losses and would like a free consultation with a securities attorney, then please call Galvin Legal, PLLC at 1-800-405-5117.
Due Diligence Requirement
FINRA requires brokerage firms to conduct due diligence on investments, such as VelocityShares 3x Long Natural Gas ETN Linked to the S&P GSCI Natural Gas Index ER (UGAZ), and to conduct a suitability analysis when recommending securities to a customer that takes into account the customer’s knowledge and experience. FINRA Rule 2111(a) states that “a member or an associated person must have a reasonable basis to believe that a recommended transaction or investment strategy involving a security or securities is suitable for the customer, based on the information obtained through the reasonable diligence of the member or associated person to ascertain the customer’s investment profile. A customer’s investment profile includes, but is not limited to, the customer’s age, other investments, financial situation and needs, tax status, investment objectives, investment experience, investment time horizon, liquidity needs, risk tolerance, and any other information the customer may disclose to the member or associated person in connection with such recommendation.”
Rule 2111 is composed of three main obligations: reasonable-basis suitability, customer-specific suitability, and quantitative suitability. Brokerage firms that fail to conduct adequate due diligence on investments they recommend, such as VelocityShares 3x Long Natural Gas ETN Linked to the S&P GSCI Natural Gas Index ER (UGAZ), or that make unsuitable recommendations can be held responsible for the customer’s losses in a FINRA arbitration claim.
If you suffered losses and would like a free consultation with a securities attorney, then please call Galvin Legal, PLLC at 1-800-405-5117.
Request a Free Consultation with a Securities Attorney
If you suffered losses investing in VelocityShares 3x Long Natural Gas ETN Linked to the S&P GSCI Natural Gas Index ER (UGAZ) and would like a free consultation with a securities attorney, then please call Galvin Legal, PLLC at 1-800-405-5117.
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Galvin Legal, PLLC is a national securities arbitration, securities mediation, securities litigation, securities fraud, securities regulation and compliance, and investor protection law practice. For more information on Galvin Legal, PLLC and its representation of investors, please visit www.galvinlegal.com or call 1-800-405-5117.
