Index Investing: From Theory to Practice · Dr MAI Huu Minh, TRAN Phan Bao Ngoc & HUYNH Nguyen Quoc BuuChapter 20 of 37 · Module 5: Index products
CHAPTER 20
Index Structured Products
Notes, certificates, warrants and ETNs — how they are built and what they cost
Opening question
“My bank offers a 3-year note on the index: 7% a year, capital protected unless the market falls more than 35%. It sounds better than an index fund. Is it?”
In this chapter
- What a structured product is and how the market classifies them
- The building blocks: zero-coupon bonds, options, barriers and digitals
- Capital-protected notes, reverse convertibles and autocallables, step by step
- Warrants, turbos and callable bull/bear contracts
- Exchange-traded notes (ETNs) and issuer risk
- Costs, regulation and seven questions before buying
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This chapter is in the full book
Chapter 1 is free to read online. The full text of chapter 20 — with its tables, figures, worked examples and practice lab — is available in the complete edition of Index Investing: From Theory to Practice (Volume 1, NXW Investment Library).
Read Chapter 1 freeGet the full book — [email protected]Sections of this chapter
20.1 What is a structured product?
20.2 A map of index structured products
20.3 The building blocks
20.4 Capital-protected notes
20.5 Yield enhancement: reverse convertibles
20.6 Autocallables
20.7 Leverage products: warrants, turbos and CBBCs
20.8 Exchange-traded notes (ETNs)
20.9 Costs, regulation and investor protection
20.10 The do-it-yourself alternative