Emerging Markets ETF Investors may have claims – Direxion Daily MSCI Emerging Markets Bull 3X ETF
The White Law Group is investigating potential claims involving broker dealers who may have unsuitably recommended high risk ETFs such as Direxion Daily MSCI Emerging Markets Bull 3X ETF (EDC).
According to Associated Press this week, investors who bet on emerging markets could see big losses this year.
Financial turmoil has engulfed many developing countries in 2018 –Argentina is dealing with 30 percent inflation, and Turkey’s currency has dropped almost by half. Indonesia’s index dropped 4 percent on Wednesday.
Many investors worry about the impact of rising interest rates and trade disputes in these tenuous economies.
According to its prospectus, Direxion Daily MSCI Emerging Markets Bull & Bear 3X ETF seeks daily investment results, of 300%, or 300% of the inverse (or opposite), of the performance of the MSCI Emerging Markets IndexSM.
The MSCI Emerging Market Index is a free float-adjusted market capitalization index that is designed to measure equity market performance in the global emerging markets such as Argentina, Indonesia, and Turkey.
The drop in currencies can lead to foreign investors selling out of emerging market stocks and bonds. The MSCI Emerging Markets index is down around 15 percent from its peak this year.
As the prospectus states, “Leveraged and inverse ETFs pursue daily leveraged investment objectives which means they are riskier than alternatives which do not use leverage…They are not suitable for all investors and should be utilized only by investors who understand leverage risk and who actively manage their investments.”
Direxion Daily MSCI Emerging Markets Bull 3X ETF (EDC) has dropped 53% since January 2018.
The White Law Group is investigating the following emerging market ETFs among others:
iShares MSCI Argentina & Glb Exps ETF (AGT)
Global X MSCI Argentina ETF (ARGT)
VanEck Vectors Indonesia ETF (IDX)
iShares MSCI Indonesia ETF (EIDO)
iShares Core MSCI Emerging Markets ETF(IEMG)
iShares MSCI Emerging Markets ETF (EEM)
Are Exchange Traded Funds Suitable for you?
Exchange Traded Funds (ETFs) can be extremely complex and risky. They are only suitable for wealthy, sophisticated retail investors or institutional investors.
Brokerage firms that sell such products are required to perform adequate due diligence on the investments to ensure a reasonable likelihood of success, and to evaluate whether the investments are suitable in light of the client’s age, net worth, investment experience, and investment objectives.
Firms that fail to perform adequate due diligence, or that make unsuitable recommendations, can be held responsible for losses in a FINRA arbitration claim.
If you suffered losses investing in Direxion Daily MSCI Emerging Markets Bull 3X ETF or another emerging market ETF and would like a free consultation with a securities attorney, please call The White Law Group at (888)637-5510.
The White Law Group is a national securities arbitration, securities fraud, and investor protection law firm with offices in Chicago, Illinois and Vero Beach, Florida.
For more information on The White Law Group, visit https://www.whitesecuritieslaw.com.