According to the UBS Puerto Rico Family of Funds brochure, “Based on your unique objectives and risk tolerance, your Financial Advisor can help you develop an investment plan that includes a portfolio mix designed to help you pursue your long-term goals.” However, it appears that many Financial Advisors underestimated the risks. In addition, despite the brochures warning that the risks “may be magnified for investors choosing to concentrate their portfolios in the funds,” many Financial Advisors did just that.
Financial professionals have a responsibility, not only to make investment recommendations that are in the best interest of their client, but are required to take into account their client’s risk tolerance, financial objectives, investment experience, age, and net worth in order to make appropriate investment recommendations.
If you invested in a UBS Puerto Rico Fund and would like to discuss your litigation options, please call the securities attorneys of The White Law Group at 561-807-6804 for a free consultation. The White Law Group is a national securities fraud, securities arbitration, investor protection, and securities regulation law firm with offices in Boca Raton, Florida and Chicago, Illinois.
The following risks were listed in the UBS Puerto Rico Family of Funds brochure:
Risks applicable to all funds
– Shares of the funds are not bank deposits and are not guaranteed or insured by any bank, government entity or the Federal Deposit Insurance Corporation. An investment in the funds is not guaranteed and you may lose money if you invest in the funds.
– Yields on the funds will fluctuate.
– The share price of the funds will fluctuate.
– There is no guarantee that a fund will be able to achieve its investment objectives.
– The funds may be required to invest at least 67% of their portfolio in Puerto
Rico securities. As such, the funds are more sensitive to economic, political,
regulatory or other factors adversely affecting Puerto Rico issuers than a fund that is not concentrated in Puerto Rico issuers. A concentration in Puerto Rico issuers may cause funds with different investment strategies to react negatively to the same market conditions.
– The funds engage in transactions, such as securities purchase and sales
transactions and repurchase agreement transactions, directly with UBS Puerto Rico and possibly other affiliates.
– A relatively high percentage of the funds’ total assets may be invested in the
obligations of a limited number of Puerto Rico issuers, so that the conditions
in the Puerto Rico market may result in a greater increase or decrease in the
funds’ net asset value than that of more diversified funds.
– The funds will be impacted by the risks associated with the funds’ underlying investments; if one of the fund’s investment sectors suffers a loss in value, this will most likely affect the overall value of the fund.
– The risks discussed herein may be magnified for investors choosing to concentrate their portfolios in the funds.
Additional risks applicable to closed-end funds
– The funds may use leverage or borrow money to make investments in securities. Using leverage may reduce the dividend the funds pay or reduce the value of your fund investment.
– The market price of fund shares is based on relative demand and supply of the shares as well as other factors, including the general
market and economic conditions discussed in the Prospectus. Accordingly,
the value of your investment in the funds will fluctuate and the price that
you are able to obtain for your fund shares may be less than the net asset
value of the shares and may be less than the price that you paid in purchasing
– While UBS Puerto Rico currently intends to maintain a market in fund
shares, it is under no obligation to do so. Therefore, there may be occasions
when you will be unable to sell your shares or will be able to sell at a loss or
at times at a significant loss.
For more information on the firm’s investigation in to UBS’s Family of Puerto Rico closed-end funds, visithttp://www.whitesecuritieslaw.
The White Law Group is investigating claims in the following:
UBS Puerto Rico Fixed Income Fund I, Inc.
UBS Puerto Rico Fixed Income Fund II, Inc.
UBS Puerto Rico Fixed Income Fund III, Inc.
UBS Puerto Rico Fixed Income Fund IV, Inc.
UBS Puerto Rico Fixed Income Fund V, Inc.
UBS Puerto Rico Fixed Income Fund VI, Inc.
UBS Puerto Rico Investors Tax-Free Fund, Inc.
UBS Puerto Rico Investors Tax-Free Fund, Inc. III
UBS Puerto Rico AAA Portfolio Bond Fund, Inc.
UBS Puerto Rico AAA Portfolio Bond Fund II, Inc.
UBS Puerto Rico AAA Portfolio Target Maturity Fund, Inc.
UBS Tax Free Puerto Rico Target Maturity Fund Inc.
UBS Puerto Rico Mortgage-Backed & Government Securities Fund, Inc.
UBS Puerto Rico GNMA & US Government, Inc.