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Energy Investors Continue to Lose Money in 2017; Investors May Be Able to Recover Their Losses in FINRA Arbitration

The law firm of Meyer Wilson has successfully represented numerous investors in recent years who suffered significant losses in energy-related stocks, master limited partnerships (MLPs), and other similar investments. If your stockbroker or financial advisor improperly sold you energy-related investments that lost money, the lawyers at Meyer Wilson might be able to help you recover your losses by filing mandatory arbitration claims with the Financial Industry Regulatory Authority (FINRA).

Over the years, many investors were talked into buying energy-related stocks and MLPs by their financial advisor because of the attractive dividends that these investments often paid. Since energy markets declined dramatically in 2015, however, these investments lost significant amounts of money both in terms of decreased dividend payouts and loss of principal.

Many of our clients have been retirees who bought these investments because of the income that these investments promised. In some cases these investments no longer pay any dividends and the principal value of the investment has lost 50 percent or more.

We have seen many instances where investors’ portfolios were over-concentrated in energy stocks such as MLPs, meaning that too much of their portfolio was invested in these stocks. Under securities industry rules, it may be unsuitable for a stockbroker to recommend that an investor over-concentrate their portfolio in a single stock or sector, like energy.

We have also seen numerous instances where financial advisors plainly misrepresented various facts about these investments and sold them as though they posed little risk to investors. In reality, as many investors have learned, MLPs and energy stocks can be incredibly risky and volatile and subject to significant risk of loss.

During the first half of 2017, some of the worst performing S&P 500 stocks continued to be energy stocks and MLPs. These include shares of Transocean Ltd. (RIG), down 44.17%; Anadarko Petroleum (APC), down 34.98%; Range Resources (RR), down 32.57%; Marathon Oil Corporation (MRO), down 31.54%; Cimarex Energy (XEC), down 30.82%; Devon Energy (DVN), down 30%; Helmerich Payne (HP), down 29.79%; Newfield Exploration (NFX), down 29.73%; Hess Corporation (HES), down 29.57%; Chesapeake Energy (CHK), down 29.20%; and Noble Energy Inc. (NBL).

Since the energy markets declined in 2015, many investors have been assured by their financial advisors that these investments will rebound. In many cases investors have been lulled by their brokers into not taking any legal action and simply hoping for the best. Energy stocks nevertheless still have not recovered overall, and investors continue to contact our office inquiring about their legal options.

If you lost money in energy stocks sold to you by your financial advisor, contact the lawyers at Meyer Wilson today to discuss your legal options. Under the law, nearly all customer disputes against brokerage firms must be brought in FINRA arbitration. The lawyers at Meyer Wilson have represented over a thousand investors in FINRA arbitrations and recovered millions of dollars on behalf of their clients.

Contact our law firm today to learn more about your legal options and rights as an investor.

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