NOTICE TO INVESTORS WITH MARGIN ACCOUNTS AT FULL-SERVICE BROKERAGE FIRMS: KlaymanToskes Commences Investigation into Damages Sustained by Investors Who were forced to Sell Securities Due to Margin Calls

KlaymanToskes (“KT”), www.klaymantoskes.com, announced today that it is investigating damages sustained by Investors who were forced to sell securities due to margin calls. The investigation focuses on full-service brokerage firms’ negligence and mismanagement of leveraged accounts. Recently, investors quickly saw the major stock indices lose significant value after closing on Friday, February 21, 2020, at near 52-week highs. The market volatility has been precipitated by COVID-19. Many investment portfolios, like the stock indices, have also seen tremendous declines, leaving leveraged accounts especially at risk of margin calls.

The use of securities in an investment account to collateralize margin loans exposes investors to leverage, which increases the risk in an account. Margin abuse can result in excessive use of margin loans or the failure to utilize risk management strategies to protect account collateral. Therefore, full-service brokerage firms and financial advisors are required to disclose to investors the risks of the use of margin. Additionally, the failure to use risk management strategies directly exposes an investor’s leveraged account to margin calls due to fluctuations in the volatile securities markets. Those margin calls may result in the forced sale of securities. However, if you made self-directed trades in your investment account with E-Trade, TD Ameritrade, Charles Schwab, Fidelity, or Interactive Brokers, or another self-trading platform, this investigation does not apply to you.

The sole purpose of this release is to investigate whether strategies deployed by full-service brokerage firms were suitable for investors whose investment accounts were leveraged by a margin loan and received calls forcing the sale of securities. Investors who held leveraged accounts at full-service brokerage firms, and have information relating to the manner in which the firm handled their portfolios, are encouraged to contact the attorneys of KlaymanToskes at (561) 542-5131, or visit our firm’s website at www.klaymantoskes.com.

About KlaymanToskes

KT is a leading national securities law firm which practices exclusively in the field of securities arbitration and litigation on behalf of retail and institutional investors throughout the world in large and complex securities matters. The firm represents high net-worth, ultra-high net-worth, and institutional investors, such as non-profit organizations, unions, public pension funds, and multi-employer pension funds. KT has office locations in California, Florida, New York, and Puerto Rico.

Destination: https://klaymantoskes.com/notice-to-investors-with-margin-accounts-at-full-service-brokerage-firms/

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