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  • Attorneys David Meyer and Matthew Wilson have been selected to the list of Super Lawyers since 2011 and 2015 respectively.

  • Attorney David Meyer is a member of the Million Dollar Advocates Forum, an organization recognizing attorneys who have secured million dollar cases.

  • Martindale-Hubbell® Peer Review Ratings™ has recognized attorney David Meyer as an AV Preeminent® attorney in High Ethical Standing.

  • Attorneys David Meyer and Matthew Wilson have received a 10 out of 10 “Superb” rating on Avvo, calculated based on stringent and exhaustive criteria.

  • Attorney David Meyerhas been selected to the list of the Best Lawyers in America® for Mass Tort Litigation / Class Actions – Plaintiffs and Professional Malpractice Law – Plaintiffs every year since 2011.

  • Attorney David Meyer was selected as the 2015 Lawyer of the Year for Professional Malpractice Law – Plaintiffs for Columbus, OH by Best Lawyers®.

  • Meyer Wilson was ranked as a Tier 1 Best Law Firm for both Mass Tort Litigation / Class Actions – Plaintiffs and Professional Malpractice Law – Plaintiffs by U.S. News.

I'm Considering Investing in Reverse Convertibles. What Should I Know?

Reverse convertibles are considered high-risk investments. Per the Financial Industry Regulatory Authority (FINRA), a reverse convertible operates like a package of financial instruments that usually has two components—a debt instrument and a derivative. You need to understand the risks associated with reverse convertibles. For example, you face the risk of the stock or asset dropping in value and the possibility that the issuer will not be able to repay its debt obligation.

The Major Risks of Reverse Convertibles Include:

Although putting money into reverse convertibles may make sense for some experienced investors, the average investor should be aware that these complex investment instruments are not always what they appear to be—and they don’t always work the way they’re described.

In fact, some structured products are so complex that the financial advisors and brokers selling them might not even fully understand how they work. Although reverse convertibles can be very high-risk investments, these products are so complex, so poorly understood, and so often touted as “safe investments” that investors are often not aware of the many risks, which include:

  • They are often hard to sell on the secondary market.
  • You may be paying high embedded fees up front.
  • You may be exposed to additional risks from the underlying asset.
  • You may be exposed to the risks associated with selling out options.

Your financial advisor or broker has a professional duty to make sure that a recommended reverse convertible is suitable for your financial goals and that you fully understand the risks.

If you were sold an unsuitable reverse convertible that resulted in losses, or if the promoter assured you that the reverse convertible was “completely safe” or “risk-free,” you may be able to recover your investment losses through FINRA arbitration. FINRA also suggests that you can protect yourself by being “wary of any advertisements or sales literature suggesting that reverse convertibles are safe and suitable for investors seeking high yields.” These ads tend to downplay the risks of these investments. For a free case evaluation, contact our office.

Need More Information?

Investment misconduct can be complex and confusing. That’s why we’re here to help you. Visit our Common Questions page to find in depth answers directly from our attorneys. Get More Answers
Have You Been a Victim of Investment Fraud?

You trusted your financial advisor with your money, but now you're left wondering what went wrong. If you or a loved one suffered losses because of investment misconduct, Meyer Wilson can step in and fight to recover your losses. The team of investment fraud lawyers at the firm has been helping people like you since 1999 by winning judgments, settlements and verdicts worth hundreds of millions of dollars against brokerage firms, financial advisors and banks.

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