Main risks

Main Risk of investment in “Structured Notes”

• Return Risk
  The return of this investment would vary with the underlying performance, and the return is not guaranteed to be higher than other investment products. If the underlying performance is unpleasant, investors may receive low or even zero return.
• Credit Risk
  Structured notes are instruments for investment and not deposit, and hence not protected by CDIC. Investors shall assume the credit risk of the issuers or guarantors.
• Interest Rate Risk
  From the date of issuance to maturity, the mark to market value of structured notes is influenced by interest rate of the investment’s denomination currency. Such mark to market value may increase or decrease and may be higher or lower than the face value.
• Liquidity Risk
  There is no liquid market for the Notes. As such, investors may not be able to redeem the Notes in the market, as the redemption may not be able to execute. Once this instrument loses its liquidity in the market, investors must hold the Notes until maturity.
• Market Risk
  Many factors can affect the level of the relevant share prices, including the political and economic environment, business conditions, investor sentiment and confidence. All of these factors can refer to local or global markets.
• Early Break by Investors
  The level of principal protection is only provided at maturity. If investors choose to redeem the Notes prior to maturity, the amount received may be lower than the principal amount due to early break cost incurred and market movements.
• Early Redemption by Issuers
  The Notes may be redeemed early by Issuer upon the occurrence of any certain event such as taxation reasons. The redemption amount may be less than original investment amount.
• Foreign Exchange Risk
  Structures Notes may be denominated in foreign currencies and investors may convert from other currencies to the denominated currency for investment. As such, investors should pay attention to possible foreign exchange risk arising from the conversion among different currencies for principal and interest amount.
• Reinvestment Risk
  In the event of early redemption of Structured Notes by investors or the of Structured Notes is called back by issuers before maturity, investors may face reinvestment risks to their capital, as the investment in the next investment may not yield the same kind of return.
• Other Risks
  These are event risk, country risk, settlement risk, taxation risk, underlying risk, and inflation risks.

Structured Notes Related Information

• About Structured Notes
• Structured Notes Fees & Channels
• Structured Notes Investment Example

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