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iPath Exchange Traded Notes (ETNs) are innovative investment products from Barclays that seek to provide investors with a way to access the returns of a market or strategy, less investor fees. The following are answers to questions financial professionals and individuals commonly ask about iPath Exchange Traded Notes.
iPath Exchange Traded Notes (ETNs) are senior, unsecured, unsubordinated debt securities issued by Barclays Bank PLC. They are designed to provide investors with a way to access the returns of market benchmarks or strategies. ETNs are not equities or index funds, but they do share several characteristics. For example, like equities, they trade on an exchange and can be shorted¹. Like an index fund, they are linked to the return of a benchmark index.
iPath ETNs provide investors with exposure to the returns of market benchmarks, less investor fees, with easy transferability and an exchange listing. The ETN structure is designed to allow investors an exchange-traded alternative to obtain exposure to investments in previously expensive or difficult-to-reach market sectors or strategies.
iPath ETNs are designed to provide investors a return that is linked to the performance of a market index, less investor fees.
The iPath ETNs currently available are listed on NYSE Arca (and in certain cases other major exchanges) and are available for purchase, similar to other publicly traded securities.
Investors can liquidate iPath ETNs one of three ways:
No.
No.
No. Investors will receive a return based on the performance of the index to which the iPath ETN is linked, less investor fees and any other applicable costs. The index level may go up or down. Even if the index level goes up (or down, in the case of ETNs that are inversely linked to the relevant underlying index), investors may not recover their principal once investor fees and costs are deducted.
No. The iPath ETNs are not rated, but rely on the ratings of the issuer, Barclays Bank PLC³.
Barclays Bank PLC and its subsidiary undertakings (taken together, the "Group") is a major global financial services provider engaged in retail and commercial banking, credit cards, investment banking, wealth management and investment management services. The Group operates in many countries around the world. The whole of the issued ordinary share capital of Barclays Bank PLC is beneficially owned by Barclays PLC, which is the ultimate holding company of the Group. For further information about Barclays, please visit our website www.barclays.com.
Barclays Capital Inc. will act as the issuer's agent in connection with the distribution of the iPath ETNs. Barclays Capital Inc. is an affiliate of Barclays Bank PLC and is a registered US broker/dealer regulated by the SEC and the FINRA.
BlackRock's broker/dealer affiliate, BlackRock Fund Distribution Company, will engage in the promotion of iPath ETNs to intermediaries including registered broker/dealers and registered investment advisors; and to end-users, such as mutual funds, hedge funds and insurance companies.
No. The iPath ETNs are debt securities and have no voting rights.
Yes. The iPath ETNs are registered under the Securities Act of 1933.
No. iPath ETNs are debt securities issued by Barclays Bank PLC and are not regulated by the CFTC; however, futures contracts underlying the relevant market index may be regulated by the CFTC.
Some iPath ETNs apply an index multiplier for purposes of calculating the closing indicative note value on each calendar day. The effect of the index multiplier is to adjust the rate at which the value of the ETN changes in response to changes in level of the relevant index.
¹ With short sales, you risk paying more for a security than you receive from its sale.
² The issuer may from time to time in its sole discretion reduce, in part or in whole, the minimum redemption amount. Any such reduction will be applied on a consistent basis for all holders of units at the time the reduction becomes effective. ³ Credit ratings are subject to revision or withdrawal at any time by the assigning rating organization, which may have an adverse effect on the market price or marketability of the iPath ETNs. |
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