Structured CDs and notes
- Structured CDs and notes typically pair a fixed income investment (such as a CD or bond) with a performance component (generally an option)
- Structured CDs and notes may help you diversify your portfolio and protect it from market volatility
- Structured products are complex products that involve investment risk and other substantial risks compared to traditional investments and may not be suitable for all investors
Potential benefits of structured CDs and notes
Diversification. Structured CDs and notes may provide diversification to a portfolio by offering exposure to asset classes that can be difficult to access directly. While diversification can help protect against certain investment risks, it does not assure a profit or protect against loss.
Reduced volatility. Structured CDs and notes may reduce the effects of market volatility within your portfolio.
Principal protection. If you select a 100% principal protected note or CD (see important disclosures below), the amount of your initial investment may be protected if you hold it until maturity. In addition, there is a possibility for gains on your initial investment.
Structured CDs and notes available from Ameriprise Financial
- FDIC-insured structured CDs are issued by U.S. banks and your initial investment is backed by FDIC insurance up to applicable limits.
- 100% principal-protected notes are issued by third-party banks. These notes sold through Ameriprise Financial are registered with the SEC and offer principal protection if the note is held to maturity, subject to the creditworthiness of the issuer.
- Principal-at-risk structured notes may help mitigate market loss, to varying degrees and offer the possibility of enhanced performance potential. These notes generally have maturity ranges from three months to seven years.
Take the next step
An Ameriprise financial advisor can work with you to determine if one of these products may be suitable for you, and then construct a portfolio that uses structured CDs and/or notes with the objective of diversifying and minimizing the effects of market volatility. To find out more about structured CDs and/or notes, contact your Ameriprise financial advisor or locate an advisor near you.
Investors should consider the investment objectives, risks, charges and expenses of the structured product carefully before investing. The prospectus and term sheet contain this and other important information about the product. Clients should read the prospectus and term sheet carefully before investing.
In the case of structured notes, protection of principal is subject to the creditworthiness of the issuer. Structured notes holders may lose up to 100% of their investment upon the bankruptcy of the issuer, even if the value of the reference asset is favorable. Creditworthiness of the issuer may change at any time during the term of the note.
Generally, structured products are not listed on an exchange, do not trade, and are not liquid. The price is provided by the issuer, or an affiliate of the issuer. In addition, broker-dealers affiliated with the issuers often make a market in structured products, but may not be able to offer liquidity, or the price may be substantially less than the original payment. Investors should be willing and able to hold their structured product investment until maturity.
General market and economic factors, some of which may be unpredictable will affect the underlying instruments or the value of the structured product. Structured products are subject to market, interest rate, and volatility risks.
Limits or caps in the appreciation of the underlying asset can limit upside appreciation while investors are still exposed to downside risk. Structured products are uniquely designed; they are not suitable for all investors.
Each offering may differ. There may be fees and costs that may impact the return of principal as well as negatively impact the performance of the product. The initial price of a purchase includes the underwriter’s commissions, the issuer’s cost of hedging its obligations for the deposit, and possibly other costs and expenses. The issuer will use part of an investor’s deposit to fund hedging activity, which means that less of an investor’s deposit is working for a performance return and that their performance return may be adversely impacted. To the extent the issuer generates proceeds from hedging activity, the proceeds are retained by the issuer. Investors should carefully review the prospectus and term sheets and discuss these fees and costs with their advisor before deciding to invest.