New Barclays ETNs (ticker TAPR) provide investors with exposure
to rising US Treasury yields
Barclays Bank PLC announced today the launch of the Barclays
Inverse US Treasury Composite Exchange Traded Notes (“ETNs”) on the
NASDAQ Stock Market (“NASDAQ”) under the ticker symbol TAPR. The
ETNs begin trading today.
The ETNs are designed to help investors position for rising US
dollar Treasury yields by tracking the Barclays Inverse US Treasury
Futures Composite Index™ (“the Index”). The Index employs a
strategy that tracks the sum of the returns of periodically
rebalanced synthetic short positions in equal face values of each
of the 2-year, 5-year, 10-year, long-bond and ultra-long US
Treasury futures contracts.
An investment in the ETNs involves significant risks,
including possible loss of principal, and may not be suitable for
all investors. The ETNs are riskier than ordinary unsecured debt
securities and have no principal protection. The ETNs are also
subject to certain investor fees, which will have a negative effect
on the value of the ETNs. The ETNs are speculative and may exhibit
high volatility.
“TAPR expands and complements our existing range of fixed income
ETNs, and offers investors a differentiated strategy to hedge
against or benefit from rising US dollar interest rates,” said Ian
Merrill, Head of ETNs Americas. “TAPR is also the first
Barclays-issued ETN to be listed on NASDAQ.”
“With economic targets being met, and the Federal Reserve
continuing the tapering of its quantitative easing program, many
investors are concerned about the potential of rising USD interest
rates,” said Manish Saraf, Director, Macro Structuring, Americas.
“The TAPR ETNs are the only ETNs that provide inverse exposure to
all five tenors on the US Treasury Futures curve using a single
instrument.”
The ETN prospectus can be found on EDGAR, the SEC website, at
www.sec.gov.
Barclays ETNs are senior, unsecured, unsubordinated debt
securities issued by Barclays Bank PLC. Barclays Bank PLC is the
issuer of Barclays ETNs and Barclays Capital Inc. is the issuer’s
agent.
Selected Risk Considerations
An investment in the Barclays ETNs described herein (the "ETNs")
involves risks. Selected risks are summarized here, but we urge you
to read the more detailed explanation of risks described under
"Risk Factors" in the applicable prospectus supplement and pricing
supplement.
You May Lose Some or All of Your Principal: The ETNs are
exposed to any decrease in the level of the underlying index
between the inception date and the applicable valuation date. Based
on historical and hypothetical historical data, the level of the
index has decreased significantly over time in the past and may
continue to decrease significantly over the term of the ETNs.
Additionally, if the level of the underlying index is insufficient
to offset the negative effect of the daily investor fee and the
index rolling cost, you will lose some or all of your investment at
maturity or upon redemption, even if the value of such index has
increased. Because the ETNs are subject to a daily investor fee and
index rolling cost, the return on the ETNs will always be lower
than the total return on a direct investment in the index
components. The ETNs are riskier than ordinary unsecured debt
securities and have no principal protection.
Credit of Barclays Bank PLC: The ETNs are senior
unsecured debt obligations of the issuer, Barclays Bank PLC, and
are not, either directly or indirectly, an obligation of any third
party. Any payment to be made on the ETNs depends on the ability of
Barclays Bank PLC to satisfy its obligations as they come due and
are not guaranteed by a third party. As a result, the actual and
perceived creditworthiness of Barclays Bank PLC may affect the
market value of the ETNs and, in the event Barclays Bank PLC were
to default on its obligations, you may not receive the amounts owed
to you under the terms of the ETNs.
Issuer Redemption: Barclays Bank PLC has the right to
redeem or “call” the ETNs (in whole but not in part) at our sole
discretion without your consent on any business day on or after the
inception date until and including maturity.
Changes in the Prices of U.S. Treasury Futures Contracts May
Affect the Value of Your ETNs: The return on your ETNs is
linked to the performance of the underlying index, which
corresponds to changes in the prices of the U.S. Treasury future
contracts included in the index, and therefore such prices may
affect the amount payable on your ETNs at maturity or upon early
redemption and the market value of your ETNs.
The Index Is Subject to Risk Associated with Synthetic Short
Positions in U.S. Treasury Futures Contracts: Because short
positions are subject to unlimited risk of loss because there is no
limit on the appreciation of the price of the relevant asset before
the short position is closed. One or more of the U.S. Treasury
futures contracts to which the Index provides synthetic short
exposure may appreciate substantially, which would have an adverse
effect on the level of the Index and, accordingly, decrease the
payment you receive at maturity or upon early redemption.
Market and Volatility Risk: The market value of the ETNs
may be influenced by many unpredictable factors and may fluctuate
between the date you purchase them and the maturity date or
redemption date. You may also sustain a significant loss if you
sell your ETNs in the secondary market. Factors that may influence
the market value of the ETNs include prevailing market prices of
the U.S. stock or U.S. Treasury markets, the index components
included in the underlying index, and prevailing market prices of
options on such index or any other financial instruments related to
such index; and supply and demand for the ETNs, including economic,
financial, political, regulatory, geographical or judicial events
that affect the level of such index or other financial instruments
related to such index.
A Trading Market for the ETNs May Not Develop: Although
we have applied to list the ETNs on NASDAQ, we cannot guarantee
that such application will be approved, and a trading market for
the ETNs may not exist at any time. Even if there is a secondary
market for the ETNs, , whether as a result of any listing of the
ETNs or on an over-the-counter basis, it may not provide enough
liquidity for you to trade or sell your ETNs easily, as we are not
required to maintain any listing of the ETNs.
No Interest Payments from the ETNs: You will not receive
any periodic interest payments on your ETNs.
Restrictions on the Minimum Number of ETNs and Date
Restrictions for Redemptions: You must redeem at least 20,000
ETNs at one time in order to exercise your right to redeem your
ETNs on any redemption date. If you hold fewer than 20,000 ETNs or
fewer than 20,000 ETNs are outstanding, you will not be able to
exercise your right to redeem your ETNs. You may only redeem your
ETNs on a redemption date if we receive a notice of redemption from
you by certain dates and times as set forth in the pricing
supplement.
Uncertain Tax Treatment: Significant aspects of the tax
treatment of the ETNs are uncertain. You should consult your own
tax advisor about your own tax situation.
Barclays Bank PLC has filed a registration statement
(including a prospectus) with the SEC for the offering to which
this communication relates. Before you invest, you should read the
prospectus and other documents Barclays Bank PLC has filed with the
SEC for more complete information about the issuer and this
offering. You may get these documents for free by visiting
www.etnplus.com or EDGAR on the SEC website at
www.sec.gov. Alternatively, Barclays Bank PLC will
arrange for Barclays Capital Inc. to send you the prospectus if you
request it by calling toll-free 1-877-764-7284, or you may request
a copy from any other dealer participating in the offering.
The ETNs may be sold throughout the day on the exchange through
any brokerage account. Commissions may apply and there are tax
consequences in the event of sale, redemption or maturity of
ETNs.
Barclays Capital Inc. and its affiliates, do not provide tax
advice, and nothing contained herein should be construed to be tax
advice. Please be advised that any discussion of U.S. tax matters
contained herein (including any attachments): (i) is not intended
or written to be used, and cannot be used, by you for the purpose
of avoiding U.S. tax-related penalties, and (ii) was written to
support the promotion of marketing of the transactions or other
matters addressed herein. Accordingly, you should seek advice based
on your particular circumstances from an independent tax
advisor.
The Barclays Inverse US Treasury Futures Composite Index™ is a
trademark of Barclays Bank PLC.
©2014 Barclays Bank PLC. All rights reserved. All other
trademarks, servicemarks or registered trademarks are the property,
and used with the permission, of their respective owners.
NOT FDIC INSURED • NO BANK GUARANTEE • MAY LOSE
VALUE
Barclays is a major global financial services provider engaged
in personal banking, credit cards, corporate and investment banking
and wealth and investment management with an extensive
international presence in Europe, the Americas, Africa and Asia.
Barclays’ purpose is to help people achieve their ambitions – in
the right way. With over 300 years of history and expertise in
banking, Barclays operates in over 50 countries and employs
approximately 140,000 people. Barclays moves, lends, invests and
protects money for customers and clients worldwide. Barclays offers
premier investment banking products and services to its clients
through Barclays Bank PLC. For more information, visit
www.barclays.com
Barclays Bank PLCMark Lane,
+1-212-412-1413mark.lane@barclays.com
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