We have a team of experts in Germany and the UK that have specialized in legal resolution involving instances where the client was not advised properly on the nature of the investment, the pricing of the asset or derivatives and related instruments. Such instances require specialized knowledge in the pricing of financial instruments which will be used to support the client’s case in legal proceedings.
Derivative investments are financial contracts that derive their value from an underlying asset, such as a stock, commodity, or currency. Examples of derivative investments include options, futures, and swaps. These derivatives allow investors to speculate on the price movements of an underlying asset, or to hedge against potential price movements.
Derivatives are relatively risky investments due to their highly leveraged nature. Leverage refers to the use of borrowed money to increase the potential return on an investment, but it also increases the potential loss. Because derivatives are leveraged, even a small movement in the price of the underlying asset can result in a large gain or loss for the investor.
Additionally, derivatives can be complex and difficult to understand, which can make it difficult for investors to fully assess the risks involved. They may also suffer from lack of transparency and liquidity, which can make it difficult for investors to exit the position. In such instances Hikmat Fayad and Associates can build a case for the injured party and assist in process of remediation.
Moreover, the market of derivatives is not regulated as much as other markets and the level of transparency may be limited. This can lead to counterparty risk where the other party to the contract may not be able to fulfil their obligations or market risk where the whole market collapses.
Overall, derivatives can be a useful tool for experienced investors who have a good understanding of the underlying assets and the risks involved, and who are looking for a way to speculate on or hedge against potential price movements. But they are not suitable for most normal investors due to the high level of risk and complexity involved, therefore in such instances where lack of transparency or wrongful misleading is involved.