What Is a Structured Note?

Structured Notes (Structured Notes) is an investment tool that combines "fixed income products" and "derivative financial products". The issuer invests most of the principal in fixed income products and uses the remaining minority of the principal Engage in the operation of derivative financial products, and at the same time achieve the purpose of protecting principal and asset appreciation (such as using 95% of principal to purchase zero-coupon bonds, 5% of principal investment options and other derivative financial products).

Structured notes

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Structured Notes (Structured Notes) is an investment tool that combines "fixed income products" and "derivative financial products". The issuer invests most of the principal in fixed income products and uses the remaining minority of the principal Engage in the operation of derivative financial products, and at the same time achieve the purpose of protecting principal and asset appreciation (such as using 95% of principal to purchase zero-coupon bonds, 5% of principal investment options and other derivative financial products).

Although structured notes are a bit like bonds, their nature and inherent risks are different from bonds.

definition:

1. A medium-term synthetic debt that contains components and characteristics that adjust the risk / reward profile of a security.

2. Financial instruments whose value depends on changes in the price of the underlying asset, allowing investors to profit from favorable price changes.

Structured notes do not necessarily pay interest, and most structured notes are not capital protected. Investors should carefully consider the issuer's background, strength and financial situation; they should also evaluate their need for liquidity in the short term.

Structured notes are composed of notes combined with other derivatives such as options, and returns are linked to the performance of other financial instruments. Common are "equity-linked notes" linked to a single or a basket of stocks, and "credit-linked notes" linked to the credit performance of one or a group of companies.