What Is Meant by the Term Cost Equity Ratio When Related to Churning?

Video Summary: When looking at churning, we are looking at how high the costs go relative to the size of the account, and when those costs will start making it mathematically improbable, if not impossible, for the account to be profitable.

Video Transcript:

Cost equity ratio is a percentage that's used in determining whether or not an account has been churned, effectively what it looks to determine is how much on a yearly basis of the return is needed just for the account to sustain itself. So it costs ratio of 10% would effectively mean that it takes 10% a year just for the account to breakeven because of what the costs are.

It's a very complicated formula and one that you need a professional to be able to determine. If you think that your account's been churned, you should contact our law firm and we can do that calculation for you to help you determine whether churning based on a cost equity ratios occurred in your account.

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 was 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 SSEK 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.