Quarterly coupon payments do not necessarily reflect the downside risks faced by the underlying notes, with a historical replay of the 2022 equity-market decline showing how autocall notes can spend extended periods below principal barriers without necessarily missing coupons.
A clean coupon record may tell investors less about the risks within an autocallable exchange-traded fund (ETF) than it appears to, according to David Condon, structured ETF analyst at Structured Investnet. The coupon record is what everyone sees, and it gets refreshed every quarter [...] the principal test is years away, and nobody sees it until it arrives - David Condon In an analysis of two FT Vest autocallable ETFs, ACYN and ACYS, Condon found that coupon payments could remain largely in