Barclays Trigger Autocallable Notes Linked to SPDR® S&P® Regional Banking ETF
Did your broker recommend investing in Barclays Bank PLC Trigger Autocallable Contingent Yield Notes Linked to the lesser performing of the SPDR® S&P® Regional Banking ETF and the SPDR® S&P 500® ETF Trust?
Investing in Structured Notes Products
Structured products are complex financial instruments that are designed to provide investors with exposure to underlying assets such as stocks, bonds, commodities, or currencies. These products typically combine two or more financial instruments, such as options, futures, and swaps, to create a unique investment that offers specific risk and return characteristics.
While structured products can offer attractive returns and diversification benefits, they also carry a range of risks that investors should be aware of before investing.
Structured products can be very complex, and their structure and payoff may be difficult to understand. This can make it hard for investors to evaluate the potential risks and returns of the investment.
They are often issued by banks or other financial institutions, and investors are exposed to the credit risk of the issuer. If the issuer goes bankrupt or defaults on its obligations, investors may lose some or all of their investment.
There is also a liquidity risk –they tend to be less liquid than other investments, meaning that it can be difficult to sell the investment quickly and at a fair price. This can result in losses if investors need to sell their investment in a hurry.
Like any investment, structured products are subject to market risk. If the underlying assets that the product is based on decline in value, the value of the structured product may also decline. In this case, the Barclays notes are linked to SPDR® S&P® Regional Banking ETF and SPDR® S&P 500® ETF Trust. Regional banks have taken a hit in the past week due to suspension of trading in SVB Financial Group and Signature Bank and could indicate bad news for investors.
Further, the pricing of structured products can be complex and may involve assumptions about future market conditions. If these assumptions are incorrect, the value of the structured product may not perform as expected.
Other risks of structured products include the fact that they are often callable, meaning that the issuer has the right to terminate the product before maturity. This can result in investors not receiving the full return they expected.
Specific Risks of investing in Barclays Trigger Autocallable Notes Linked to SPDR® S&P® Regional Banking ETF
According to the prospectus, investing in Barclays Trigger Autocallable Notes Linked to SPDR® S&P® Regional Banking ETF includes significant risks such as: you may lose a significant portion or all of your principal — The notes differ from ordinary debt securities in that the Issuer will not necessarily pay the full principal amount of the Notes at maturity.
Further, the Issuer will not necessarily make periodic coupon payments on the Notes, and if the Notes are automatically called, you will not receive Contingent Coupons or any other payment in respect of any Observation Dates after the applicable Call Settlement Date. Because the Notes could be called as early as the second Observation Date, the total return on the Notes could be minimal.
Your return on the Notes is contingent upon the independent performance of each Underlying. Unlike an instrument with a return linked to a basket of underlying assets in which risk is mitigated and diversified among all the components of the basket, you will be exposed to the risks related to each Underlying. Poor performance by either Underlying over the term of the Notes may negatively affect your return.
Because the notes are linked to the “lesser performing underlying”, you are exposed to greater risks of no Contingent Coupons and sustaining a significant loss of principal at maturity than if the Notes were linked to a single Underlying.
Recovery of Investment Losses
The White Law Group is investigating the liability that brokerage firms may have for recommending complex, often extremely high-risk, structured notes such as Barclays Autocallable Notes Linked to SPDR® S&P® Regional Banking ETF.
With the market in turmoil, many investors who purchased such investments believing they provided downside protection or were akin to bonds because of the dividend component are instead finding that these products can indeed suffer enormous losses.
Brokers often pitch structured products, as providing “downside protection” against losses to a related index while allowing modest upside gain potential. Of course, this is only true if the value of the index doesn’t fall below a predetermined price. If the price falls below that point, the losses in structured notes can still be huge.
These products typically pay a high fee to the financial advisors that sell them.
Brokerage firms have two main duties in recommending structured callable notes linked to equity investments or indexes. First, brokerage firms are required to perform adequate due diligence on any product they recommend. Second, brokerage firms are required to ensure that all recommendations made are suitable for their client in light of the client’s age, investment experience, net worth, income, and investment objectives.
If a brokerage firm fails to do either of these things, the firm can be held responsible in a FINRA arbitration claim.
Hiring a Securities Attorney
The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm dedicated to helping investors in claims in all 50 states against their financial professional or brokerage firm. Since the firm launched in 2010, it has handled over 700 FINRA arbitration cases.
Our firm represents investors in all types of securities related claims, including claims involving stock fraud, broker misrepresentation, churning, unsuitable investments, selling away, and unauthorized trading, among many others.
With over 30 years of securities law experience, The White Law Group has the expertise to help investors defrauded in securities, investment and financial business transactions attempt to recover their investment losses.
The firm reviews securities fraud cases throughout the country.
If you have questions about investments you made with a financial advisor, the securities attorneys of The White Law Group may be able to help. For a free consultation, call the firm’s office at 888-637-5510.
For more information on The White Law Group, please visit our website at https://whitesecuritieslaw.com.
Tags: Barclays Structured Notes, Barclays Trigger Autocallable Notes Linked to SPDR® S&P® Regional Banking ETF, securities attorneys, structured products Last modified: April 27, 2023