Investment involves risk. You should carefully consider the risks and features of any investment products (including but not limited to equities/exchange traded funds/exchange traded derivatives & structured products) or services mentioned herein to assess whether they are appropriate for you in view of your investment experience, objectives, financial resources and relevant circumstances. The price of investment products may move up or down. Losses may be incurred as well as profits made as a result of buying and selling investment products.
Unit Trusts
- Unit trusts are investment products and some may involve derivatives. The investment decision is yours but you should not invest in the unit trusts unless the intermediary who sells it to you has explained to you that the product is suitable for you having regard to your financial situation, investment experience and investment objectives
- Unit trusts are NOT equivalent to time deposits
- In the worst case scenario, the value of the unit trusts may be worth substantially less than the original amount you have invested
Bonds and Certificates of Deposit ('CDs')
Bonds / CDs are mainly medium to long-term fixed income products, not for short-term speculation. You should be prepared to hold your bonds / CDs for the full tenor; you could lose part or all of your principal if you choose to sell the bond / CD prior to maturity.
It is the issuer who pays interest and repays principal of bonds / CDs. If the issuer of your bond / CD defaults, you might not be able to receive back the interest and principal. You bear the credit risk of the issuer and have no recourse to HSBC unless HSBC is the issuer itself.
Indicative prices of bonds / CDs are available, but prices will fluctuate with market changes. Factors affecting market price of bonds / CD include, and are not limited to, fluctuations in interest rates, credit spreads, and liquidity premiums. The fluctuation in yield generally has a greater effect on prices of longer tenor bonds / CDs. There is an inherent risk that losses may be incurred rather than profit made as a result of buying and selling bonds / CDs.
If you wish to sell bonds / CDs, HSBC may repurchase it based on the prevailing market price under normal market circumstances, but the selling price may differ from the original buying price due to changes in market conditions.
There may be exchange rate risks if you choose to convert payments made on bonds / CDs to your home currency.
The secondary market for bonds / CDs may not provide significant liquidity or may trade at prices based on the prevailing market conditions and may not be in line with the expectations of holders of bonds / CDs.
If the bonds / CDs are redeemed early, you might not receive the same rates of return when you use the funds to purchase other products.
Renminbi (RMB) related products
There may be exchange rate risks if you choose to convert RMB payments made on the bonds to your home currency.
RMB debt instruments are subject to interest rate fluctuations, which may adversely affect the return and performance of the RMB products.
RMB products may suffer significant losses in liquidating the underlying investments if such investments do not have an active secondary market and their prices have large bid-offer spreads.
You could lose part or all of your principal if you choose to sell your RMB bonds prior to maturity.
