Excessive Trading or "Churning"
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When a broker buys and sells securities in your account to generate commissions that seem excessive, there is a strong possibility that your account is being "churned.” However, “churning” also includes any trading done to benefit the broker - rather than the investor. Therefore, even one trade may be churning if it has no legitimate purpose. To establish that a broker churned your account, you must show excessive trading patterns. This can be done with several kinds of evidence, including:
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