(February 4 , 2012, New York, N.Y) Investors from J.P. Morgan Chase (JPM) , Morgan Stanley (MS) , UBS (UBSN.VX) and Barclays (BARC.LN) were sold millions of dollars of structured products linked to the now collapsing Apple (AAPL) common stock. Firms knowing that investors were searching for yield promoted Apple structured products as safe investments that would provide high yield with little risk based on its ever rising stock price. Nothing could have been further from the truth. The products were highly complex with names that were similarly complex:
• Reverse Exchangeable Notes
• Yield Optimization Notes
• Buffered Equity Notes
• Trigger Notes
• Auto-Callable Notes,
• STEP Income Securities
• Strategic Accelerated Redemption Securities (STARs)
• Return Optimization Securities
• Contingent Interest Notes
While these notes provided high interest rates for one year or less but the principle was only secure if the stock stayed steady or rose from the level at which it was when the product was purchased which was mostly at approximately $650 per share. As a result now that Apple has fallen to $443 investors have lost over 30% of their funds and as time goes on its even more. Those who invested in such products will not receive their principle back when the products become due, instead they receive Apple stock which has now fallen by over 30%. These products provided firms with a cheap method of betting on the collapse of Apple stock. All they needed to pay was the interest charges if the stock stayed the same or went up.
Most brokers did not properly explain the significant risks of these complex structured products.
If you purchased any Apple related structured product you may be entitled to you money back. Call us for a free phone consultation.
Stuart D. Meissner Esq.
275 Madison Avenue, Suite 1000
New York, N.Y. 10016