Enhanced exposure to losses and gains due to price changes.
The price of an option is closely linked to that of the underlying asset. Any change
in the market value of the underlying asset will result in a greater change in the price
of the option. This is termed the leverage effect. It means you participate disproportionately
in any rise or fall in the market value of the underlying asset.
Structured products with leverage enable you to achieve a leverage effect by investing
less capital than you would have to if you invested directly in the underlying. This
means you can benefit from short-term trends.
Structured products with leverage are suitable for short-term speculation but also for
strategically hedging a portfolio.
Because of the leverage effect, you need to carefully and regularly monitor the
underlying, since structured products with leverage can experience a larger rise in
profits but also a bigger loss than the underlying.
When you invest in a structured product with leverage, you could in the worst case
lose the entire capital that you have invested.
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