Who To Blame for Trading Losses:
Whether it is bogus accounting practices, mis-leading research, over-hyped IPO’s or any other of the many Wall Street scandals, investors and traders often become so frustrated and irate that they are tempted to sue their broker. Occasionally they may be successful in recouping some of their losses . More often your broker or external influences are not to blame and responsibility should be placed fully on the person whose face graces your driver’s license.
It is vitally important for anyone trading the markets to be fully apprised of their responsibilities. Mainly it is imperative to learn about the person or organization that you trust with your hard earned money. Your research and analysis of a broker and his company should precede their researched investment recommendations.
As an investor:
* Read every piece of paper that you are given.
* Review and understand every disclosure document.
* Question every item that you find confusing.
* Research every investment that is recommended.
* Never sign anything until you fully understand, and always get a copy of everything that you do sign.
Even if you have done your due diligence , remember your broker/advisor has a fiduciary obligation to give you good advice. If you believe you have been the victim of a scam, you can seek help through arbitration or in extreme cases through legal counsel. Unfortunately, the reality of litigation is that it is often painful, frustrating, time consuming and costly. To help prevent scenarios such as these remember to exercise caution, do your own research, ask questions, monitor your positions and always insist that your positions are protected through the use of “stop loss” orders.
