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Investment Fraud Attorney Jake Zamansky Says There’s No Bounce Back for YES Investment Strategy

June 10, 2020 Blog

While stocks have recovered from their historic March lows, a complex investment product known as the UBS Yield Enhancement Strategy or YES, has not enjoyed a similar bounce back.

Just a couple of months ago, the Dow Jones Industrial Average and the S & P 500 suffered their worst first quarter in history, losing 23% and 20%, respectively, for the first three months of the year as a result of the COVID-19 pandemic and resulting economic shutdown.

The S & P 500 saw its most volatile month ever, with frenetic swings whipsawing the market from steep gains to even steeper losses. Both indices plunged over 30% from their February 19 record close to their March 23 lows.

Investors Are Still Suffering Losses Despite Market Uptick

Ever since, the market has seen an amazing turnaround. The Dow and the S & P 500 had a breakneck bounce back seeing gains which left them, amazingly, near their all-time highs.  It’s been a tumultuous ride in the market for Mom and Pop investors.

Unfortunately, YES, an “options overlay strategy” that UBS sold to its retail customers, continues to suffer losses and has pummeled investor portfolios.

“YES, whose holdings peaked around $6 billion in mid-2018, effectively borrows against clients’ holdings at UBS and uses the proceeds to trade options,” according to a recent Wall Street Journal article. “The product is akin to a margin loan against existing holdings; losses could compel an investor to put in extra cash or securities.”

“Although clients say UBS financial advisers told them the strategy was conservative, in reality it often embedded risky bets that the market would stay placid—gambles on which many investors lost 20% or more.”

The strategy “seeks to limit exposure to significant upside or downside market moves,” according to the YES marketing material, and could “generate additional cash flow from lower yielding assets.”

YES “has limited correlation with the market or a single stock position,” so it could offer diversification, said the document. Using options strategies for protection, “we prepare for unexpectedly volatile market conditions.”

However, in the first quarter of 2020 alone, YES lost -16%, causing investors to exit the strategy in droves. Assets under management have fallen from $6 billion to less than $1.5 billion.

Contact Investment Fraud Attorney Jake Zamansky to Discuss Your Legal Options

According to the Journal, at least 60 YES investors have filed investment fraud cases to recover their losses.

Despite the recovery in the broad stock market, the YES strategy is seeing no bounce back and continues to harm investors. Speak to investment fraud attorney Jake Zamansky if you’ve sustained losses related to YES.

To find out more about YES, check out our most recent prior coverage on the subject:

Jake Zamansky Quoted in WSJ Regarding YES Financial Losses

Claims Related to the UBS YES Strategy Continue to Soar

INVESTOR ALERT: UBS Yield Enhancement Strategy (YES) Update on COVID-19 SPX Market Crash

Client Reviews

“Jake Zamasky and his colleagues represented me in a FINRA arbitration case against a large multinational bank and succeeded in obtaining an award for the full amount of my investment losses. I would highly recommend the Zamansky firm for their experience in securities litigation, their level of detailed research and case preparation, and their ability to effectively fight for what’s right.”

Richard R.

“Throughout my entire case, Jake Zamansky was incredibly responsive and spent time walking me through each step of the process. He is professional and worked with my challenging schedule, even meeting with me nights and on weekends. He knew exactly which turn to take when it came to my case and yet was respectful of any decisions I wanted to make resulting in a positive outcome.”

Donald A.

“Jake Zamansky and his firm represented me in a FINRA arbitration case to recover investment losses. Jake and his team were very professional and worked very hard preparing for trial and then reaching a substantial settlement of our case. I would highly recommend them.”

William E.

“Jake Zamansky represented me in a FINRA arbitration case which allowed me to recover a substantial portion of investment losses. He is truly an expert in this space and I would highly recommend him to those investors who may have been been a victim of investment fraud.”

Chris K.

“Jake and his team did a great job communicating with me throughout the process of my lawsuit. I would recommend him to anyone looking to sue UBS for unethical practices.”

Mike A.
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