Securities Lawyers Blog
Gana Weinstein LLP, a full-service nationally recognized securities litigation firm, is investigating Credit Suisse Securities (USA) LLC for underwriting and VLS Securities, LLC (VLS) for marketing the VelocityShares Daily 2x VIX Short Term Exchange Traded Notes (TVIX). According to TVIX’s offering documents and marketing materials, TVIX was linked to twice the daily performance of the S&P 500 VIX Short-Term Futures Index. The offering documents stated that TVIX was designed for investors who seek exposure to the applicable underlying index.
TVIX do not represent ownership in any basket of securities, instead TVIX acts as a debt instrument that is supposed to track an index and on which the issuer pays the note based on the terms of the offering documents. As a result, investors may receive a cash payment at maturity. TVIX began trading on November 30, 2013 at a $100 per share price. On February 21, 2012, Credit Suisse temporarily suspended the issuance of new shares of TVIX, due to internal limits reached on the size of TVIX, according to Credit Suisse.
On March 22, 2012, the TVIX shares decline in price by over 29% as rumors were circulating that Credit Suisse was considering whether to begin reissuing shares of TVIX. On March 23, 2012 after Credit Suisse announced that it would reopen issuance of TVIX, the shares dropped another 30% in value.