Trade of the month: Range-defined products

Tim Mortimer outlines his trade of the month

Under consideration this month are products that have income potential defined by ‘range' type conditions. These products may or may not have capital protection. Income is calculated every coupon period - such as annually or semi-annually - and paid out if any income accrues. Instead of providing a fixed or Libor-based income stream, the size of each coupon depends on a range-defined condition. The range conditions can be defined in a variety of ways, but generally they are either ‘one-touch' or