Equity-linked Notes (ELN)

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#7
(19-04-2013, 04:50 PM)godjira1 Wrote: Eln is basically writing equity options no? IE collect premium.

a long time ago, when bonds actually have a significant yield, the ELN can be structured where the purchaser pays 100%, of which X is used to purchase the zero bond (since it trades below par) and 100-X can be used to purchase an option. If the option is ITM at maturity, investor redeems the zero and collects the option payoff, hence he does not need to sell the option i.e. he has bot a right.

nowadays with bonds yielding nothing, the most common way is for the investor to write an option, pray for nothing to happen, and hopefully collect the premium. Of cos, this also means that it is non-principal protected since he has written a liability.
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Messages In This Thread
Equity-linked Notes (ELN) - by revolta - 19-04-2013, 02:00 PM
RE: invest in equity link notes - by Musicwhiz - 19-04-2013, 02:05 PM
RE: Equity-linked Notes (ELN) - by smallcaps - 19-04-2013, 02:13 PM
RE: Equity-linked Notes (ELN) - by AlphaQuant - 19-04-2013, 02:18 PM
RE: Equity-linked Notes (ELN) - by CityFarmer - 19-04-2013, 04:03 PM
Equity-linked Notes (ELN) - by godjira1 - 19-04-2013, 04:50 PM
RE: Equity-linked Notes (ELN) - by AlphaQuant - 19-04-2013, 05:07 PM
RE: Equity-linked Notes (ELN) - by revolta - 19-04-2013, 07:48 PM
RE: Equity-linked Notes (ELN) - by Temperament - 19-04-2013, 09:27 PM
RE: Equity-linked Notes (ELN) - by camelking - 19-04-2013, 09:38 PM
RE: Equity-linked Notes (ELN) - by greengiraffe - 19-04-2013, 09:59 PM
RE: Equity-linked Notes (ELN) - by AlphaQuant - 19-04-2013, 09:59 PM
RE: Equity-linked Notes (ELN) - by camelking - 19-04-2013, 10:06 PM
RE: Equity-linked Notes (ELN) - by AlphaQuant - 19-04-2013, 10:13 PM
RE: Equity-linked Notes (ELN) - by Temperament - 19-04-2013, 10:11 PM
RE: Equity-linked Notes (ELN) - by freedom - 19-04-2013, 10:31 PM
RE: Equity-linked Notes (ELN) - by camelking - 19-04-2013, 10:38 PM
RE: Equity-linked Notes (ELN) - by arthur - 19-04-2013, 10:58 PM
RE: Equity-linked Notes (ELN) - by Temperament - 19-04-2013, 11:22 PM
RE: Equity-linked Notes (ELN) - by AlphaQuant - 20-04-2013, 08:42 AM
RE: Equity-linked Notes (ELN) - by camelking - 20-04-2013, 08:51 AM
RE: Equity-linked Notes (ELN) - by AlphaQuant - 20-04-2013, 09:02 AM
RE: Equity-linked Notes (ELN) - by Temperament - 20-04-2013, 09:38 AM
RE: Equity-linked Notes (ELN) - by AlphaQuant - 20-04-2013, 09:50 AM
RE: Equity-linked Notes (ELN) - by Temperament - 20-04-2013, 10:13 AM
RE: Equity-linked Notes (ELN) - by camelking - 20-04-2013, 11:50 AM
RE: Equity-linked Notes (ELN) - by weijian - 20-04-2013, 09:20 AM
RE: Equity-linked Notes (ELN) - by revolta - 20-04-2013, 11:10 AM
RE: Equity-linked Notes (ELN) - by revolta - 24-04-2013, 05:33 PM
RE: Equity-linked Notes (ELN) - by AlphaQuant - 24-04-2013, 05:48 PM
RE: Equity-linked Notes (ELN) - by CityFarmer - 24-04-2013, 09:30 PM
RE: Equity-linked Notes (ELN) - by revolta - 24-04-2013, 09:37 PM

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