“There's usually some sort of multiplier. So if the market's down 16%, 16 minus 15 is 1 times 5, your note is down 5%... if the market's down 20, 20 minus 15 is 5 times 5, your note's down 25”
Janus Henderson · Animal Spirits Podcast · Talk Your Book: The Next Generation of Income Strategies
Play from 25:42
25:42
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What was described
offers stability notes that pay a multiplier (e.g., 5x) on the amount the market breaches a single-day barrier
example multiplier 5x; barrier 15% on S&P, 45% on SK Hynix; if market down 16% with 15% barrier, note loses 5%
Said nearby on the same subject
“The first thing that Jay did was to implement an even more aggressive version of Ben Bernanke's financial market stabilization where he was willing to effectively backstop private sector borrowing”
“It's just one divided by one minus the tax rate is what you would need to multiply the Roth conversion by to know the total amount you'd have to take out to also cover the tax bill”
“You can create a contingent seller note ... if this larger client churned for any reason, there would be some mechanism to not pay out the rest of that note”