Fixed Income Alternatives

  1. Understand the core product risks.
  2. Understand the structure.
  3. Understand the reference security.
  1. Understand the core product risks.

Are you making a deposit in a bank via an FDIC insured Certificate of Deposit, or are you lending money to a corporation for a senior, unsecured note, i.e. a corporate bond?

Either way, the concept of “credit” is integral to investing in a structured product.  Notes and CDs do default.  Consider the impact of a full or partial default on your investment.

Terms of structured products, including both CDs and notes, are qualified by holding the instrument to maturity.  If you sell the investment before maturity, either to the very-active secondary market, or to the issuer, you may put either your hedge or gains at risk.

  1. Understand the structure.

Unlike most coupon-bonds, structured products may have terms that put principal at risk.  If there is protection, is it 100% at maturity, a…

View original post 1,623 more words


The practice of trash talking with personal insults rather than appeal to reason has dominated our political season.  This kind of logic is known as argumentum ad hominem, or ad hominem for short.  The personal attack is intended to discredit any statement made by the opponent. It is a logical red herring designed to distract from the business at hand.  It is the full time occupation of the Congress of the United States.

Ad hominem tu quoque is to use the “I know you are but what am I?” line of reasoning.  It translates to “You do that too.”  There is a big difference between a persuasive argument and a statement of fact. In order to reach valid conclusions it is important to distinguish guilt by association or circumstance from cold, hard, empirical facts.  All’s fair in marketing and politics.  The emotional ad hominem is used freely and frequently to…

View original post 94 more words