Structured notes may seem like a good investment opportunity, especially when an autocall feature is attached. But every seasoned investor knows that if it sounds too good to be true, it probably is. Below, we go into greater detail about what autocallable structured notes are, the potential risks of autocallable notes, and what your options might be if you lose money due to such an investment.
Autocallable Structured Notes: How It Works
An autocallable note is a market-linked investment that includes a coupon that is only available if the note automatically matures before a set maturity date. A note can be automatically matured if its value meets or exceeds its reference asset.
If this happens, the investor can then make a considerable return with the coupon. However, these autocallable structured notes are not without risk.
Risks of Autocallable Notes
There are many different potential risks associated with autocallable notes. To start, they are not designed to be liquid, nor do they offer principal protection. In fact, autocallable notes can be extremely volatile. If the security declines below a threshold level, the autocallable notes can lose all of their value and cease paying income. Gains are also dependent on the creditworthiness of the issuer, so if they cannot make payments, the investor could lose money.
These are just a few of the more serious risks associated with autocallable structured notes. You can reach out to your investment loss lawyer if you believe your financial advisor or stockbroker is responsible for the losses you endured after investing in an autocallable structured note.
Contact a Qualified Investment Loss Lawyer
If you lost money due to an investment of autocallable structured notes and don’t know where to turn, reach out to a reputable investment loss lawyer at Wolper Law Firm to discuss your legal options. You can reach our office by phone at 800.931.8452 or through the convenient contact form provided below.
Attorney Matthew Wolper
Matt Wolper is a trial lawyer who focuses exclusively on securities litigation and arbitration. Mr. Wolper has handled hundreds of securities matters nationwide before the Financial Industry Regulatory Authority (FINRA), American Arbitration Association (“AAA”), JAMS, and in state and federal court. Mr. Wolper has handled and tried cases involving complex financial products and strategies ranging from traditional stocks and bonds to options, margin and other securities-based lending products, closed/open-end mutual funds, structured products, hedge funds, and penny stocks.
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