What is a Blanket Recommendation?
The blanket recommendation involves a communication from a brokerage firm to all its customers. Generally, the communication has to do with advice on a given stock, with a recommendation to buy or sell the given stock or sector. The blanket recommendation is sent to all customers, regardless of the status of the investment portfolio, the stated investment goals of the client, or the level of risk tolerance usually exhibited by the customer. The purpose behind the issuing of a blanket recommendation has to do with alerting all the clients of the brokerage firm to an upcoming change in the stock market that is anticipated to have a profound impact on a given stock or security. The change may lead to a significant rise in the price per share of a given stock, which would result in creating a sizable increase in the value of the stock portfolio that included shares of that stock. In contrast, if a significant downward trend is anticipated with a particular investment, the brokerage will us
