![]() Consequently, these ETPs may experience losses even in situations where the underlying index or benchmark has performed as hoped. Compounding can also cause a widening differential between the performances of an ETP and its underlying index or benchmark, so that returns over periods longer than one day can differ in amount and direction from the target return of the same period. Due to the effects of compounding and possible correlation errors, leveraged and inverse ETPs may experience greater losses than one would ordinarily expect. Inverse ETPs seek to provide the opposite of the investment returns, also daily, of a given index or benchmark, either in whole or by multiples. Leveraged ETPs (exchange-traded products, such a ETFs and ETNs) seek to provide a multiple of the investment returns of a given index or benchmark on a daily basis. ![]() Diversification does not eliminate the risk of investment losses. A call right by an issuer may adversely affect the value of the notes. Sector investing may involve a greater degree of risk than an investment in other funds with broader diversification. ETNs may have call features that allow the issuer to call the ETN. ETNs containing components traded in foreign currencies are subject to foreign exchange risk. Leveraged and inverse ETNs are subject to substantial volatility risk and other unique risks that should be understood before investing. ETNs may be subject to specific sector or industry risks. ![]() ![]() The market value of an ETN may be impacted if the issuer's credit rating is downgraded. The repayment of the principal, any interest, and the payment of any returns at maturity or upon redemption depend on the issuer's ability to pay. ETNs are not secured debt and most do not provide principal protection. Exchange-Traded Notes (ETNs)ETNs are not funds and are not registered investment companies. ![]()
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