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Equity Linked Note

Chalanachithram.com DB » New TF Industry Related » Archive through July 11, 2016 » Equity Linked Note « Previous Next »
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Jambalahaart_raja
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Username: Jambalahaart_raja

Post Number: 6762
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Posted on Friday, July 08, 2016 - 02:31 pm:       


Andhrawala:

next 7 years



Goldman Sachs adrushtam baagunte 2 recessions vasthaayi ee time lo...
avasaramaa??
"Chill Bro.
I told you to let it go!!"
- The Budhha.
 

Rebel
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Posted on Friday, July 08, 2016 - 02:19 pm:       

y don't u invest directly in s&p 500 index fund ?
 

Inquisitive
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Username: Inquisitive

Post Number: 1603
Registered: 09-2014
Posted From: 24.251.166.131

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Posted on Friday, July 08, 2016 - 02:12 pm:       


Andhrawala:

Yesterday met a Financial analyst here.

He was talking about some 7.5% coupon rate Equity Linked Notes from Goldman Sachs


So if we buy those notes for face value of 10K, we get interest of 7.5 per annum for next 7 years. and after expiry of 7 years as long as S&P doesnt go below 1600 pts we get our 10K back.

If S&P increases to say 2500 then GS may call back after an year.

Has anyone invested in ELNs?



Intha story and fancy name enduku? Simple ga ila describe cheyyochu:

Goldman Sachs is interested in buying Put Options at 1600 S&P, they are willing to pay $750 per year for the options. Anybody willing to sell? Margin money 10K deposit cheyyali for him to ensure that you don't default in case he exercises the option.
"Sakshi is a most balanced and independent media. This has no affiliation with any political party," Jagan had said. Link: http://www.outlookindia.com/news/article/sakshi-retelecasts- story-omits-antisonia-remarks/701963
 

Inquisitive
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Username: Inquisitive

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Posted on Friday, July 08, 2016 - 02:09 pm:       


Andhrawala:

Our invetsment is safe as long as S&P doesnt go down below 1600 from current 2100

if it goes below that then we loose principal



So Goldman Sachs is willing to take a small risk on their investment but if there's a big loss, we have to provide 100% insurance to them? It looks like a terrible deal. Large companies providing insurance to small individuals makes sense to me but what is this idea of small individuals providing insurance to a large company?!
"Sakshi is a most balanced and independent media. This has no affiliation with any political party," Jagan had said. Link: http://www.outlookindia.com/news/article/sakshi-retelecasts- story-omits-antisonia-remarks/701963
 

Andhrawala
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Username: Andhrawala

Post Number: 52503
Registered: 03-2008
Posted From: 152.51.56.1

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Posted on Friday, July 08, 2016 - 02:06 pm:       


Inquisitive:



Case 1: S&P goes down: I will get $750 each year for 7 years and then get 10K minus losses in S&P back after 7 years.




Our invetsment is safe as long as S&P doesnt go down below 1600 from current 2100

if it goes below that then we loose principal
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Inquisitive
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Username: Inquisitive

Post Number: 1600
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Posted on Friday, July 08, 2016 - 02:01 pm:       

So you are saying that if I invest 10K, and

Case 1: S&P goes down: I will get $750 each year for 7 years and then get 10K minus losses in S&P back after 7 years.

Case 2: S&P rises, I will get 750 per year until it rises to a substantial level and after that I will get my 10K back and Goldman Sachs will keep the gains from S&P.

Is that it?

If so, it is like providing insurance to Goldman Sachs. He wants to invest in S&P but he has two problems.
1. He doesn't have the funds.
2. He doesn't want to take the risk of losses.

So he finds an insurance provider like you and me (bakra) and borrows our money and invests it. He pays us an insurance premium plus interest (total 750 USD per year) and asks us to bear all the losses but if there are gains he will take it and return the borrowed money.
"Sakshi is a most balanced and independent media. This has no affiliation with any political party," Jagan had said. Link: http://www.outlookindia.com/news/article/sakshi-retelecasts- story-omits-antisonia-remarks/701963
 

Andhrawala
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Username: Andhrawala

Post Number: 52501
Registered: 03-2008
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Posted on Friday, July 08, 2016 - 01:33 pm:       

Yesterday met a Financial analyst here.

He was talking about some 7.5% coupon rate Equity Linked Notes from Goldman Sachs


So if we buy those notes for face value of 10K, we get interest of 7.5 per annum for next 7 years. and after expiry of 7 years as long as S&P doesnt go below 1600 pts we get our 10K back.

If S&P increases to say 2500 then GS may call back after an year.

Has anyone invested in ELNs?
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