Beware of Wall Street's Latest Fad  

Oleh:

Revell, Janice

Jenis: Article from Bulletin/Magazine
Dalam koleksi: Fortune vol. 164 no. 4 (Sep. 2011), page 22.
Topik: Financial Market; Wall Street; Investors; Marketing; Economic Conditions

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Perpustakaan Pusat (Semanggi) Nomor Panggil: FF16.46 Non-tandon: 1 (dapat dipinjam: 0) Tandon: tidak ada

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Given the wrenching market volatility in recent weeks, the idea of shielding your portfolio from a big decline while still being able to profit from future gains sounds mighty appealing. That's the promise of the so-called structured note, a product that's been popular with institutional investors for years. Now Wall Street is aggressively marketing these notes to individual investors. And retail sales of structured notes are booming: They increased by 46% in 2010 to a record $49.4 billion, according to Bloomberg, and are on track to be up again sharply in 2011. But beware: The retail versions are watered-down, overpriced imitations of the protection offered to the big guys -- and may be riskier than advertised. Indeed, in June both the Financial Industry Regulatory Authority (FINRA) and the Securities and Exchange Commission issued alerts warning about their significant drawbacks.

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