Linking to ETFs vs. Linking to Indices -

A person studying structured products issuances for the first time might think he is having a case of double vision. On the one hand, there are a variety of products linked to certain well known equity indices. On the other hand, there are other products, with fairly comparable economic terms that are linked to an exchange traded fund, or ETF, that tracks the same index.

Why the “duplication”? This article discusses some of the considerations that product manufacturers must address when considering whether to structure a product that references the performance of an index or to reference the performance of a related ETF.