Table of Contents
What is an auto-callable?
An autocallable is a popular structured product that pays a high coupon if the underlying – typically equity indexes or single stocks – passes an upside barrier, at which point it automatically matures and the investor’s principal is returned.
What is a cancelable swap?
What is a cancellable swap? It is a combination of an interest rate swap and a receiver’s swaption that may be cancelled by the borrower at no cost on an agreed future date. The cost of the swaption is embedded into the fixed rate of the swap.
What is an auto-callable yield note?
Auto-Callable Yield Notes provide investors the opportunity to earn contingent interest at an above-market rate if the underlying asset closes at or above a specific threshold level on periodic observation dates.
What is Auto-Callable equity Linked Investment?
Auto-callable Equity-linked investment is a Structured investment product where the outcome is determined by the price movements of a local, or foreign public-listed companies of your choice. The investment have a short tenor that ranges from 6 to 12 months with regular coupons.
What are auto calls?
An automated phone system is any telephone system that interacts with callers without input from a human other than the recipient. OnSolve provides a phone system with automated dialing that places auto calls.
What is a Phoenix note?
Phoenix Notes are designed to pay a monthly, quarterly or semi-annual coupon as long as the underlying assets do not drop below the coupon barrier. As Phoenix notes, by design, pay out a regular coupon they generally offer a lower yield than an Auto-callable notes, as a result.
What is Bermudan swap?
A Bermuda swaption is a variation of a regular (“vanilla”) swaption that gives the holder the right, but not the obligation, to enter into an interest rate swap on any one of many predetermined dates.
How do Callable yield notes work?
Callable Yield Notes allow investors to receive interest payments, regardless of the movements in the underlying. The CYNs will return the principal amount if the underlying does not reach or breach the Knock-In Level at any time during the life of the trade.
What are contingent income auto callable securities?
Autocallable contingent income securities, or autocalls, are a relatively new type of structured finance security whose payout is contingent on the performance of an underlying asset and that gives investors an opportunity to earn high yields in a low-interest environment.
What is a Phoenix autocall?
In a Phoenix Autocall with a Memory Feature, on any of the annual anniversary dates, two independent measurements are taken: • If the asset level is equal to or greater than the Coupon Barrier, it will pay out a Coupon for that year. If the asset is below the Coupon Barrier, no Coupon will be paid.
How do automated calls work?
Auto dialing phone systems use software and a modem to let a computer automatically dial a list of phone numbers. An Automated Calling Service makes sense in situations where many outbound calls, texts or emails are necessary, and speed and accuracy are important.
How does automatic dialing work?
An automatic dialer (also spelled auto dialer, auto-dialer, and autodialer) is an electronic device or software that automatically dials telephone numbers. Once the call has been answered, the autodialer either plays a recorded message or connects the call to a live person.
What is a barrier note?
Barrier Notes allow investors to express a view on whether a particular reference rate will be greater than a set reference barrier strike rate at a specified time in the future.
What is a buffered note?
Buffered Notes are short-term structured investments offering an enhanced return based on the performance of the underlying asset, with a contingent amount of downside protection. Unlike Principal Protected Notes, Buffered Notes offer a limited amount of downside protection.
What is a 1Y10Y swaption?
If you buy a 1Y10Y 2% receiver swaption, it basically means that you have the right to receive a 2-percent rate on a 10 year basis starting in 1 year.
Why are swaptions used?
Swaptions are generally used to hedge options positions on bonds, to aid in restructuring current positions, to alter a portfolio or to adjust a party’s aggregate payoff profile. Due to the nature of swaptions, market participants are typically large financial institutions, banks and/or hedge funds.
Why do banks issue callable bonds?
Why Companies Issue Callable Bonds. Companies issue callable bonds to allow them to take advantage of a possible drop in interest rates in the future. The issuing company can redeem callable bonds before the maturity date according to a schedule in the bond’s terms.
What is a callable swap?
A callable swap is a contract between two counterparties in which the exchange of one stream of future interest payments is exchanged for another based on a specified principal amount. These swaps usually involve the transfer of the cash flows from a fixed interest rate for the cash flows of a floating interest rate.
What is a call swaption?
A call swaption is a position on an interest rate swap that gives the holder the right to pay a floating rate of interest and receive a fixed rate of interest from the swap counterparty.
What is a putable swap?
A swap where the payer of the variable or floating rate has the right, but not the obligation, to end the contract before expiration is called a putable swap . There is little difference between an interest rate swap and a callable swap other than the call feature.
What is an autocallable?
Autocallable An autocallable is a structured product which offers an opportunity for both early redemption at a predefined cash amount and high coupons. Both these opportunities are linked to the performance of the underlying which can be either of the following: The spot of a single asset. The worst performance in a defined basket of assets.