does anyone here have experience trading "index linked notes" with a guaranteed value? if so, kindly touch on the basics. thanks! surfer
The only way there is ever a "Guaranteed" return in any bond, note, etc is to hold until maturity. Then if the company, gov etc goes bankrupt, all bets are off..... Index linked thingaminjiggies are basically just corp bonds. but to answer your question, the answer is no...i have not traded those. Happy Holidays
i have used them in the past when they go under the 10 strike. the most common ones are called mitts. they are a merrill lynch product. they dont move much and do not move 1 to 1 with the market. they buy a long bond and marry it with an index option. here is one. http://www.amex.com/?href=/strProd/prodInf/SpPiProdDesc.jsp?Product_Symbol=RRM
Sight for sore eyes , I was serching for you on the net last night ,just to see what you were up to. I found you at Trading Markets , read your stuff. Hope this finds you well , would love to touch base and just say hello. Woodfish
Hah... I have personally designed / engineered guaranteed equity index linked notes, in my quant days. At the time (late 1990s -- early 2000s), similar products were getting increasingly popular in Europe and Japan, but not in the US. Don't know about now. The Handbook of Equity Derivatives has a good treatment.