Anyone own these? I have a few. Basically I hold for 13 months and at expiration if x stock isn’t down by y amount (usually 35- 50%%) then I get funds back, but have been earning interest in the interim of 9-15% depending on stock.

Thoughts ?

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Posted by slackster

Houston

Member since Mar 2009

84612 posts

Posted on 6/23/21 at 10:07 pm to Pierre

What particular structured note?

Ultimately they’re a packaged financial product, so a healthy amount of skepticism should be exercised.

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Posted by Pierre

Baton Rouge

Member since Nov 2005

5279 posts

Posted on 6/23/21 at 10:13 pm to slackster

Just paired with a stock. Rules apply.

Typical note say Netflix

13 month term pays 9.5 percent as long as Netflix stays above a 35% decline in stock price at the end of the 13 month period. If below congrats you own Netflix at the eroded price.

They are packaged separately and individual stocks from investment banks to hedge large investments in that specific stock.

This post was edited on 6/23/21 at 10:16 pm

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Posted by slackster

Houston

Member since Mar 2009

84612 posts

Posted on 6/23/21 at 10:59 pm to Pierre

quote:
They are packaged separately and individual stocks from investment banks to hedge large investments in that specific stock.

Yeah I’m familiar with them, was just asking what the specifics of the note were. Thanks.

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Posted by NC_Tigah

Carolinas

Member since Sep 2003

123782 posts

Posted on 6/24/21 at 6:03 am to Pierre

quote:
Thoughts ?

Some are good. Some aren't.
They are essentially option spreads assembled by a marketmaker. The marketmaker passes both premium and service costs on to you. Some costs may be hidden within the structured returns. Some costs may be up front.

We've enjoyed excellent results with UBS structured products when we've used them in the past, mainly when anticipated market environment was static or declining. Haven't held any in a couple of years though.

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