Cryptocurrency Q&A
Do ETNs have principal protection?
Do ETNs have principal protection?
CryptoMystic
Fri Aug 16 2024
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7 answers
1698
Excuse me, I've been hearing a lot about ETNs lately and I'm curious about their risk profile. Could you clarify if ETNs offer principal protection? In other words, if the underlying asset or index declines in value, does the investor still retain the initial investment amount, or is there a risk of losing some or all of it? It would be helpful to understand this aspect of ETNs before considering them as an investment option.
7 answers
Ilaria
Sun Aug 18 2024
Instead, ETN investors receive a cash payment at maturity that is linked to the performance of an underlying index, minus any associated fees.
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CryptoVeteran
Sun Aug 18 2024
This structure makes ETNs an attractive option for investors seeking exposure to specific markets or asset classes without having to physically own the underlying assets.
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ShintoSpirit
Sun Aug 18 2024
ETNs, or Exchange Traded Notes, are a type of financial instrument that possesses a unique set of characteristics.
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Chloe_martinez_explorer
Sun Aug 18 2024
However, it's important to note that ETNs are only backed by the credit of the issuer, which can introduce an element of risk for investors.
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Filippo
Sun Aug 18 2024
Unlike traditional bonds, ETNs have a stated maturity date but do not offer periodic coupon interest payments.
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