ETRACS DVHL Lawsuit FINRA Investigation

DVHL Stock Lawsuit

Notice to UBS ETRACS Monthly Pay 2x Leveraged Diversified High Income ETN (DVHL) investors. The Haselkorn & Thibaut, P.A. law firm is a nationwide investment fraud law firm investigating potential sales practice violations by financial advisors who were recommending ETRAC DVHL exchange-traded notes to investors.

The recent trading in DVHL has been in the $5.00/share range and even lower. Looking back, over the second half of 2016, DVHL was generally trading at or above $20.00/share, and that trend continued to 2018. Through 2018 and 2019, the share price generally ranged between $15.00/share and $20.00/share, and that trend continued through 2019 and even into early March 2020 when the share price was still in the range of $15.00/share. The year-to-date total return is down over -75%.

DVHL seeks a return linked to the NYSE® Diversified High Income Index. The ETRACS Monthly Pay 2xLeveraged Diversified High Income ETN due November 12, 2043 (the “Securities”) are a series of Monthly Pay 2xLeveraged Exchange Traded Access Securities (ETRACS). The investments are unsecured debt securities/instruments issued by UBS AG. The index measures the performance of a diversified basket of publicly-traded instruments that historically have paid high dividends or distributions. The index constituent Securities must satisfy certain dividend or distribution yield and frequency criteria, liquidity criteria and other eligibility requirements.

ETRACS DVHL Lawsuit FINRA Investigation

The Haselkorn & Thibaut, P.A. law firm is a nationwide investment fraud law firm ( investigating potential sales practice violations by financial advisors who were recommending DVHL and many similar ETRAC exchange-traded notes sold to investors.

For investors, this is a particularly severe blow as these are the types of investments that were often recommended by financial advisors to clients who were looking for income in their portfolios (often retirees or similarly conservative investors). This was likely a recommendation that was expected to be low volatility and reasonably conservative, now investors are faced with substantial losses as a result of a level of risk to their original investment principal that was probably never properly disclosed (if it was ever disclosed at all) by their financial advisors.

As some strategies are leveraged in the hopes of increasing potential returns, they also increased the level of risk, and some investors may not have been advised of those inherent risks as well.  Although Financial advisors may claim that these were unforeseen market events, the reality is that these are similar risks to those experienced in the 2008-2009 financial crisis. These potential risks were material risks that should have been appropriately disclosed to clients before recommending these investments individually or as part of a portfolio or investment strategy.

Many of these investments were sold by UBS Financial advisors and other financial advisors without proper risk disclosures, as these are considered very risky and complicated (some even speculative because of the leverage) securities. In cases where these were recommended to retirees or similar conservative income-seeking investors there is the potential for sales practice abuse as a result of misrepresentations, but more often as a result of omissions of material fact, or due to a lack of proper supervision.

Investors Seeking to Recover DVHL Losses

For some investors, a private FINRA arbitration customer dispute enables them to bring a claim and potentially recoup their investment losses of DVHL. These customer disputes typically involve only paper discovery and no depositions, and they are generally faster and more efficient compared to traditional court litigation, as they provide a private forum to resolve disputes more quickly and efficiently. Read more on how to sue a financial advisor.

About Haselkorn & Thibaut, P.A.

Haselkorn & Thibaut, P.A. has filed numerous (private arbitration) customer disputes with the Financial Industry Regulatory Association (FINRA) for customers who suffered investment losses relating to issues similar to those matters mentioned above. There are typically no depositions involved, and those cases are usually handled on contingency with no recovery, no fee terms. Experienced attorneys at Haselkorn & Thibaut, P.A., are available for a free consultation as a public service. Call today for more information at 1-800-856-3352.

Scroll to Top