Structured Products Risk Factors

Prior to making structured investments part of a well diversified portfolio, investors and advisors might consider the following questions in connection with the evaluation of a structured investment:

What is the product's investment objective? Can less costly, complex or risky products achieve the objectives of this product?
What assumptions underlie the product, and how sound are they? What market or performance factors determine the investor's return?
If the product is expected to generate increased yield, does the yield justify any risk to principal? If principal risk is "buffered", what is the upside and downside?
What costs and fees for the investors are associated with this product? Are the costs and fees transparent? How do the fees compare with comparable products?
Does the product present any novel legal, tax, market investment, or credit risks? Is there FDIC Insurance?
What is the complexity of the product in structure, function and description? Is this product understandable and transparent enough to explain in layman's terms? Are there caps, barriers or contingencies associated with the payout of the structure?
What is the incentive of the advisor or brokerage firm offering the product? How liquid is the product? How active is the secondary market?
What is the expected liquidity of the product?

Full disclosure of the risk factors for each product is available from the relevant term sheets and prospectuses or offering documents. Investors should consult their Financial Advisor for investment advice and read all applicable offering documents before investing. Investors should carefully review the risk factors section in the relevant offering documents. Documents filed with the SEC are available on the SEC website at sec.gov. Any agent or dealer participating in the applicable product offering will also arrange to send investors these documents on request. Incapital makes no recommendations concerning any structured investment or the suitability thereof.

Financial Professionals