Market Volatility May Be The New Normal

The market is bouncing wildly, and that should make Mom and Pop investors pause and take note. The S&P 500 hit new highs in mid-July, reaching 3,000. Then on Monday, it had its worst day of the year, losing 3% to close trading at 2,844. The broad stock market is jumping on a slew of …

Wall Street’s Worst ‘Doublespeak’—The Yield Enhancement Strategy

Wall Street is notorious for saying one thing to investors and meaning something else. It’s called “doublespeak,” language that deliberately obscures, disguises or distorts the meaning of words. The term was coined after the great British writer George Orwell used the term “doublethink” to describe a reality that was completely distorted, where down was up, …

Breaking Down Yield Enhancement Strategies and How They Fail

Yield enhancement strategies (YES) are high-risk investments that can result in substantial losses. They are also highly-complex; and, as a result, they are only suitable for the most-sophisticated of investors. If you have lost money in a YES investment, here are some of the key terms you need to know: Yield Enhancement Strategy A “yield …

Expected Market Volatility During 2019 Could Spell Trouble for “Iron Condor” Investors

The “iron condor” is an extraordinarily complex investment product. A form of “yield enhancement strategy,” or “YES,” it involves making at least four separate options trades with the hope that none of the options will actually reach their strike price so that the investor can pocket a modest “option premium.” With an iron condor, the …

Collateral Yield Enhancement Strategy (CYES) Offered by Merrill Lynch, Morgan Stanley and Other Firms

Zamansky LLC is investigating an options-based investment strategy utilized by various brokerage firms — including Morgan Stanley and Merrill Lynch — sometimes referred to as the Collateral Yield Enhancement Strategy, or “CYES”. The CYES is a complicated and risky options strategy, managed by Harvest Volatility Management, LLC. The CYES utilizes “iron condor” options trades and …

UBS, Credit Suisse and Other Wall Street Firms Continue to Face Scrutiny for Yield Enhancement Strategy (YES) Investments Sold to Individual Investors

Similar to all other consumer industries, there are fads in the retail investment market. One recent fad promoted by big Wall Street banks like UBS and Credit Suisse is the “yield enhancement strategy,” also known by the acronym, “YES.” Despite its catchy name, and despite being pitched as a low-risk alternative to traditional investing, the …

Wall Street Continues to Push Yield Enhancement Strategies (YES) Despite the Risks

There is no question that yield enhancement strategies (YES) present substantial risks for individual investors. There is also no question that most individual investors lack the in-depth knowledge of options, margin, puts, calls and other relevant investment concepts needed to make informed decisions about investing with yield enhancement strategies. But, this has not stopped Wall …

Duty-of-Prudence Claim Asserted Even Under Stricter Standard Used to Dismiss Lawsuit – New York Law Journal

IBM employees appealed dismissal of claims that fiduciaries of IBM’s employee stock option plan violated their duty under ERISA to manage plan assets prudently because they knew, but did not disclose, that IBM’s microelectronics division was overvalued. District court found a prudent fiduciary could have concluded an earlier corrective disclosure would have done more harm than good. …