Enhanced income structured investments are appropriate for more risk tolerant
investors seeking higher returns than comparable debt instruments. These
short-term notes offer enhanced coupon payments. Payout at maturity is
determined by the performance of an underlying asset or group of assets;
however, they are typically linked to a single stock.
Investors forfeit full participation in the appreciation of the underlying asset
in exchange for the potential to earn higher coupon payments. These products do
not offer principal protection and investors are subject to potential losses
and may receive shares of the underlying security at maturity.
Enhanced income investments can be used to manage portfolio risk while
generating positive returns in a flat to moderately positive market
environment. Higher coupons may also help to offset potential declines in the
underlying investment.
Considered buy and hold investments, enhanced income products do not typically
limit or cap upside participation. Investors are exposed to downside risk and
may lose part of all of their original investment. Additionally, investors may
receive shares of stock at a value below the original principal amount at
maturity.
Coupon payments and payment at maturity is subject to the credit risk of the
issuer.
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