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After the hangover of last year, the sudden awakening of tech stocks has also had serious repercussions on the other side of the ocean. In particular, investment certificates listed on Piazza Affari. Derivatives, with their conditionally protected version of capital, have in the past driven many American securities to the top of the wave. Stocks with high growth and high volatility, therefore able to pay more attractive coupons or premiums, but also with greater risk.
Recent Netflix Case The decline exceeded 30% Just one day after what the market deemed disappointing results, these risks are back in the spotlight. The collapse of Beyond Meat a few months ago had savers worried. Given that Netflix is undoubtedly a more well-known and widespread brand in terms of credential building, this time the case is more striking.
Conditionally protected capital certificates have capital protection linked to the failure to reach certain hurdles (either during the life of the instrument or at maturity). If this happens, due to a fall in the price of the underlying, Then you lose your protection and usually your coupon. «There are 99 capital certificates with conditional protection linked to Netflix listed – explains trainer and trader Gabriele Bellelli. Of these, 82 are “worst” baskets, while 17 are built only on Netflix. 95 have “discrete” barriers, while 5 have “continuous” barriers. This means that almost all barriers are validated on a specific expiration date, so if that date is far away, the crash will not have an immediate impact.
«The certificates with continuous barriers – continues Bellelli – have all broken their barriers. Of the certificates with discrete barriers, only 13 currently still have a full barrier level. In other words, 86 currently see Netflix below the threshold level. The closer the deadline is, the greater the risk of losing protection. ”
Many of the certificates were issued in the aftermath of the pandemic, when a strong rally in stock markets reduced volatility, so the search for yield drove structures with more volatile underlying securities. Now, as a recent warning from the Bank of Italy highlights, the risks of these plants are coming to light.
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