Structured Notes

Structured Notes are debt instruments where
the principal and/or the interest rate is indexed
to an unrelated indicator. A bond whose interest
rate is decided by interest rates in England or
the price of a barrel of crude oil
would be a Structured Note,

Sometimes the two elements of a Structured Note
are inversely related, so as the index goes up,
the rate of payment (the "coupon rate") goes down.
This instrument is known as an "Inverse Floater."

With leveraging, Structured Notes may
fluctuate to a greater degree than the underlying index.
Therefore, Structured Notes can be an extremely
volatile derivative with high risk potential
and a need for close monitoring.

Structured Notes generally are traded OTC.