Measuring damages for fraud-based mismanagement of a securities portfolio

Measuring damages in cases of portfolio mismanagement can be a tricky job f or securities litigators. Noting that the federal securities laws fail to p rovide any set measure of damages for fraud-based mismanagement of a portfo lio, the author suggests an "alternative investment" model for these types of damages. After providing an overview of the basic measures of damages fo r a Section 10(b) violation, the author discusses the claims that arise fro m portfolio mismanagement and examines case law measuring damages for portf olio mismanagement. Finally, the author describes an ''alternative investme nt'' model and illustrates its application in this situation.