UBS Arbitration Claims Moving Forward

UBS customers who have lost money in the UBS Yield Enhancement Strategy (UBS YES), and who have filed arbitration claims against UBS to recover their losses are having their cases move to hearings before FINRA.

UBS YES involved investing in options with a complex series of put and call spreads with the same expiration date and different strike prices with a strategy called an “iron condor”. UBS marketed its Yield Enhancement Strategy as a safe way for investors to increase return on their money at a time when interest rates were low.

The iron condor strategy was based on the premise that when interest rates are low, investors would be willing to pay higher prices for securities because they expect a higher rate of return. The strategy used this premise to bet on a rise in interest rates by using both call and put options with the same expiration date and different strike prices. If the investor had an interest rate expectation of less than 10%, then the strategy would use only calls to bet on a rise in interest rates.

 Unfortunately, it was quite risky, the risk may not have been adequately disclosed, and some investors lost a lot of money. It is not too late to file a claim and potentially recover your losses.

if you were an investor in the UBS YES strategy. For more information, and to discuss a potential claim call Sallah Astarita & Cox, LLC at 212-509-6544. The firm represents investors and financial professionals across the country and has represented parties in over 700 arbitrations.