Justia Lawyer Rating
Super Lawyers - Rising Stars Kirk G. Smith
Super Lawyers Samuel B. Edwards
Super Lawyers William S. Shephard
Texas Bar Today Top 10 Blog Post
Avvo Rating. Samuel Edwards. Top Attorney
Lawyers Of Distinction 2018

Alternative Investment Losses

What Are Alternative Investments?

Alternative investments are non-traditional investments. They are any investment that is not a publicly-traded bond or a stock, or publicly traded mutual funds composed of bonds and stocks.

Once only for institutional investors and high-net-worth individual investors, they have become more popular with retail investors in recent years. However, this does not mean they are suitable for most of the latter, especially inexperienced investors, retirees, and others who are not able to take on much risk.

Complex, liquid, and subject to limited regulation, many alternative investments tend to require a high minimum investment while charging higher fees and costs than traditional investments. They also are more high-risk, can be volatile, and may come with:

  • Inadequate transparency
  • Not enough suitable performance benchmarks
  • Likely conflicts of interest
  • Higher commissions and fees
  • Long-term investment time horizons

Yet, many investors, including retail investors, are drawn to alternative investments because they offer the possibility of higher returns than traditional investments—that is if the risks and downsides don’t prove too much.

Other draws from investing in alternative investments include added diversification to a portfolio —as long as your broker doesn’t overconcentrate your portfolio with too many of them —as well as special features and potential tax benefits.

Why Do Broker-Dealers Find Alternative Investments So Appealing?

Alternative investments tend to appeal to brokerage firms because they typically charge higher commissions than traditional investments. Considering that the broker-dealer may also charge other costs and fees, this type of investment can make them more money.

Not only that but also the commissions for the brokers who sell non-traditional investments tend to be higher.

Broker-dealers have even started offering their own proprietary alternative investments. A recent example of this is David Lerner Associates’ Energy 11, LP, Energy Resources 12, LP, and Spirit of America Energy Fund (SOAEX), which have come under scrutiny over possible unsuitable recommendations made by its brokers to customers.

Unfortunately, alternative investments can cause huge losses for investors. Although market volatility or unforeseen events can play a part, in many instances, broker fraud or negligence may also have been a factor.

At Shepherd Smith Edwards and Kantas (SSEK Law Firm at investorlawyers.com), our seasoned alternative investment fraud attorneys work with investors throughout the United States in recovering losses caused by the negligent or fraudulent actions of their brokers and broker-dealers. We have represented retail investors, retiree investors, high net worth individual investors, and institutional investors for over 30 years and recovered many millions of dollars on their behalf.

Alternative Investment Products That SSEK is Continuing to Investigate

Although market volatility can play a role in causing alternative investments to lose value, unsuitability, misrepresentations and omissions, breach of fiduciary duty, negligence, misappropriation, and failure to supervise by brokerage firms can also contribute to these losses.

This is why you need to work with experienced alternative investment fraud attorneys who know how to pursue your broker fraud claim in Financial Industry Regulatory Authority (FINRA) arbitration.

Our team of lawyers, consultants, and experts at SSEK Law Firm have a combined over a century’s worth of experience in securities law and the securities industry. More than 90% of the investors who’ve retained our services have achieved total or partial financial recovery.

Are Alternative Investments Generally Unsuitable for Individual Investors? Other Examples of Alternative Investments Fighting For Victims of Alternative Investment Fraud

Our knowledgeable alternative investment fraud law firm has won cases against some of the largest broker-dealers on Wall Street. SSEK Law Firm has offices all over the United States. Call us at (800) 259-9010 today or contact us online to schedule your free, no-obligation case consultation.

Client Reviews
★★★★★
"I am going to miss conversations with you, Sam Edwards. You’ve been a wonderful lawyer and a friend. I loved learning legal jargon from you. But, even more, it is your self respect and commitment to your position that I admire and your persistent patience-your equanimity. With great appreciation, thank you!" M.B.
★★★★★
"My experience with Ryan Cook has been very positive. Through every step of the litigation he explained what to expect to happen. When I spoke with him later he reviewed the process. He was very patient and I never felt rushed. I have already told friends how wonderful he is." L.R.
★★★★★
"I want you to know that I very much appreciate your expertise, hard work and guidance that led to a satisfactory resolution with Raymond James. From our first meeting, I felt "heard" and that my situation and story were respected. Every subsequent interaction I had with any of you - in person, via email or by phone - only corroborated that feeling. What great work you do on behalf of people like me who have been wronged, yet don't know how to navigate the appeals/mediation/arbitration process as you do. I will be forever grateful." M.L.
★★★★★
"Good positive experience, guided us through a difficult process and was pleased with the outcome. Everyone I dealt with were exceptional." A.G.
★★★★★
"Good intelligent attorneys who never miss a beat. I set my expectations high and they delivered above and beyond. Do not miss the opportunity to let SSE&K represent you. Top notch, efficient and effective firm." S.M.
Contact Us
  1. 1 Free Consultation
  2. 2 No Recovery, No Fee
  3. 3 Over 100 Years Experience

Fill out the contact form or call us at (800) 259-9010 to schedule your free consultation.