Investors should be aware that the price of the high yield note depends on various factors such as volatility of the underlying, tenor, strike level, underlying spot price, interest rate etc. An increase in the underlying spot price may not necessarily mean an increase in the Note price.
These Notes are issued by major financial institutions and have credit risk. Shall the issuer of the Notes default; investors may not be able to recover the full value of the capital invested.
The Notes are not listed on any exchanges and the liquidity of the Notes in the secondary market may be limited. Investors should be prepared to hold the Notes until maturity. The Notes may be mandatorily redeemed early due to the issuer’s hedging issues, credit and default events, taxation changes etc. Investors should refer to the issuing prospectus for further information.
Investors may receive physical delivery of reference assets at settlement date; the product is not collateralized and not covered by Investors Compensation Fund.