Global Regulatory and Legal Disclosures
Global Regulatory and Legal Disclosures
Last
modified: July 26, 2024
Global
Regulatory and Legal Disclosures
Performance
Trust Capital Partners, LLC ("PTCP") is a registered broker-dealer and a
member of the Financial Industry Regulatory Authority ("FINRA"), the
Securities Investor Protection Corporation ("SIPC"), and the National
Futures Association ("NFA"). These disclosures apply to all data, models
or modeling, information from back-testing, communications, videos,
publications, speaking engagements, and all written materials in any format
whatsoever whether related to services or otherwise (collectively,
"information") to you from PTCP and are intended only for institutional
investors as defined by FINRA Rule 2210(a)(4), qualified institutional buyers
as defined in Rule 144A under the Securities Act of 1933, as amended; a "Professional
Investor" as defined in the Securities and Futures Ordinance (the "SFO")
and /or the Securities and Futures (Professional Investor) Rule ("Professional
Investor Rules") and / or the SFC's Code of Conduct for Persons Licensed by or
Registered with the Securities and Futures Commission ("Code of
Conduct"); or a "per se professional client" or an "elective professional
client" as defined by the FCA's Conduct of Business Rules. You should notify us
immediately if, at any point in time, you consider that you would no longer
fall within one of the above definitions of an institutional or professional
investor/client.
Personal Use Only. All information contained herein shall only be used
by the recipient for his/her own personal reference. Any other use, including
any disclosure or distribution to of any information to any third party,
requires the express written permission of PTCP.
For
Informational Purposes Only. The
information described in this communication is provided to you "as is" and "as
available" without warranties of any kind, expressed, implied, or otherwise,
including but not limited to all warranties of merchantability, fitness for a
particular purpose, or non-infringement.
The views, written or otherwise,
expressed in the information are those of authors or speakers alone and are
subject to change without notice. PTCP has no obligation to the information.
Any views expressed in the information are those of the authors or speakers alone
and are subject to change without notice.
Such views or
statements in any information do not necessarily reflect the views and opinions
of PTCP, its affiliates, or its employees. This information is intended for
informational purposes only and should not be regarded as an offer to sell or a
solicitation of an offer to buy the products or securities to which it applies.
PTCP makes no representations as to accuracy, completeness, timeliness,
suitability or validity of any information presented herein and will not be
liable for any errors, omissions, or delays in this information or any losses,
injuries or damages arising from its display or use and no representation is
made that any returns will be achieved through its use
NO ACTION HAS BEEN MADE OR WILL BE
TAKEN IN CONNECTION HEREWITH THAT WOULD PERMIT AN OFFERING OF ANY SECURITIES OF
ANY ENTITY APPEARING IN THE INFORMATION IN ANY JURISDICTION IN WHICH ACTION FOR
THAT PURPOSE IS REQUIRED. NO OFFERS, SALES, RESALES OR DELIVERY OF ANY
SECURITIES OR DISTRIBUTION OF ANY OFFERING MATERIAL RELATING TO ANY SECURITIES
MAY BE MADE IN OR FROM ANY JURISDICTION EXCEPT IN CIRCUMSTANCES WHICH WILL
RESULT IN COMPLIANCE WITH ANY APPLICABLE LAWS AND REGULATIONS AND WHICH WILL
NOT IMPOSE ANY OBLIGATION ON PTCP.
THE INFORMATION DOES NOT DISCLOSE
ALL THE RISKS AND OTHER SIGNIFICANT ISSUES RELATED TO AN INVESTMENT IN ANY
SECURITIES. THE INFORMATION IS NOT INTENDED TO BE DISTRIBUTED TO ANY INVESTOR
OR PROSPECTIVE OR INVESTORS.
Information Provided May Not Be
Accurate Or Complete And May Be Sourced From Third Parties.
All information, whether proprietary to PTCP or a third
party, is provided "as is" and PTCP makes no express or implied
warranties, and expressly disclaims all warranties of merchantability or
fitness for a particular purpose or use with respect to any information
included herein. Other than disclosures relating to PTCP, the
information has been obtained from sources that PTCP believes to be
reliable, but PTCP makes no representations that the information
contained herein is accurate, reliable, complete, or appropriate for use by all
investors in all locations.
Further, PTCP does not
guarantee the accuracy or completeness of information that is obtained from, or
is based upon, trade and statistical services or other third-party
sources. Because of the possibility of human and mechanical errors as
well as other factors, PTCP is not responsible for any errors
or omissions in the information contained herein. PTCP is not
responsible for, and makes no warranties whatsoever as to, the content of any
third-party web site accessed via a hyperlink contained herein and such
information is not incorporated by reference.
Information Provided Is Not
Indicative of Future Results. Any information on past
performance contained herein is not necessarily indicative of future
results. All levels, prices and spreads are historical and do not
represent current market levels, prices or spreads, some or all of which may
have changed. The information referenced herein or any of the results
derived from any analytic tools or reports referenced herein are not intended
to predict actual results and no assurances are given with respect
thereto.
The value of and income from any
investment may fluctuate from day to day as a result of changes in relevant
economic markets (including changes in market liquidity).
No Liability.
To the extent permitted by law, in no event shall PTCP, nor any
affiliate, nor any of their respective officers, directors, partners, employees
or third party licensors have any liability, direct or indirect, including but
not limited to any special, punitive, indirect, or consequential damages or any
lost profits, lost revenue, loss of anticipated savings or loss of opportunity
or other financial loss, even if notified or advised of the possibility of such
damages or potential loss, arising from any use of the information provided
herein.
No Advice. PTCP and its
affiliates do not provide tax, legal or accounting advice. This material has
been prepared for informational purposes only, and is not intended to provide,
and should not be relied on for, tax, legal or accounting advice. You should
consult your own tax, legal and accounting advisors before engaging in any
transaction.
The information provided does not
constitute investment advice or take into account the individual financial
circumstances or objectives of the clients who receive it. This document
is not advertising or marketing any financial investment product, service or
transaction.
No Use for Valuation Purposes. No data or price information
should be used for any valuation, trading, settlement, accounting purposes or
other related functions.
Not Available in All Jurisdictions.
Not all products or services mentioned are available in all
jurisdictions. No offers, sales, resales, or delivery of any products or
services described herein or any offering materials relating to any such
products or services may be made in or from any jurisdiction except in
circumstances which will result with compliance with any applicable laws and
regulations and which will not impose any obligations on PTCP.
Intellectual Property.
©2023 Performance Trust Capital Partners, LLC. All rights reserved. Performance
Trust Capital Partners, LLC is a registered trademark of Performance Trust
Capital Partners, LLC. No part of this document may be reproduced or
redistributed in any manner without the prior written permission of Performance
Trust Capital Partners, LLC.
Sales
and Trading Materials Disclosure
This
Sales and Trading Disclosure applies to any document, information, marketing
material, desk strategy, market or trading commentary, data, models or
modeling, information from back-testing, communications, videos, publications,
speaking engagements, and all written materials in any format whatsoever
whether related to services or otherwise (collectively and individually, "Sales
and Trading Materials") that has been provided to a prospect or client by
or in conjunction with the sales and trading personnel of Performance Trust
Capital Partners, LLC ("PTCP"), a SEC registered broker-dealer and a member of FINRA/SIPC/NFA.
Sales
and Trading Material is provided on a confidential basis and may not be
reproduced, distributed or transmitted in whole or in part without the prior
written consent of PTCP and is intended only for institutional investors as
defined by FINRA Rule 2210(a)(4), qualified institutional buyers as defined in
Rule 144A under the Securities Act of 1933, as amended; a "Professional
Investor" as defined in the Securities and Futures Ordinance (the "SFO")
and /or the Securities and Futures (Professional Investor) Rule ("Professional
Investor Rules") and / or the SFC's Code of Conduct for Persons Licensed by or
Registered with the Securities and Futures Commission ("Code of
Conduct"); or a "per se professional client" or an "elective professional
client" as defined by the FCA's Conduct of Business Rules. The financial
products or services referred to in Sales and Trading Materials may not be
eligible for sale in all jurisdictions. Sales and Trading Materials are
directed at institutional clients who have professional experience as defined
by applicable law or regulation in the relevant jurisdiction. It is not for and
should not be provided to retail clients and it is not for distribution into
any jurisdiction where providing Sales and Trading Materials is not permitted.
Any
opinions expressed in Sale and Trading Materials are those of the author who is
a member of the sales, trading, or analytics department. Information presented
in the Sales and Trading Material has been obtained from or based upon sources
believed by the personnel or product specialist to be reliable, but PTCP does
not represent or warrant its accuracy or completeness and is not responsible
for losses or damages arising out of errors, omissions, or changes or from the
use of information presented in this document. This Sales and Trading Material
does not purport to contain all the information that an interested party may
desire and, in fact, provides only a limited view. The information provided is
not intended to provide a sufficient basis on which to make an investment
decision. The Sales and Trading Material is intended only to provide
observations and views of certain personnel, which may be different from, or
inconsistent with, the observations and views of other PTCP personnel or the
proprietary positions of PTCP. Observations and views expressed herein may be
changed by the personnel at any time without notice.
Any
statements contained herein of future expectations and other forward-looking
statements are based on firm personnel's current view and assumptions and
involve known and unknown risks and uncertainties that could cause actual
results, performance, or events to differ materially from those expressed or
implied in such statements. Actual results, performance, or events may differ
materially from those in such statements due to, without limitation (i) general
economic conditions, including in particular economic conditions in PTCP's core
markets, (ii) performance of financial markets, including emerging markets,
(iii) the frequency and severity of insured loss events, (iv) mortality and
morbidity levels and trends, (v) persistency levels, (vi) interest rate levels,
(vii) currency exchange rates, including the Euro - U.S. dollar exchange rate,
(viii) increasing levels of competition, (ix) changes in laws and regulations,
including monetary convergence and the European Monetary Union, (x) changes in
the policies of central banks and/or foreign governments, and (xi) general
competitive factors, in each case on a global, regional and/or national basis.
The
Sales and Trading Material is provided for informational purposes only, is
subject to change without notice and is not binding. Any prices or quotations
in Sales and Trading Materials are indicative only, are subject to change
without notice and may not be used or relied on for any purpose, including
valuation purposes. Any communication that contains Sales and Trading Material
is not a solicitation to buy or sell any product, or to engage in, or refrain
from engaging in, any transaction, except to the extent covered by the CFTC
Rules (see Derivatives Disclosure below). The Sales and Trading Material
does not constitute investment research, a research report or a personal or
other recommendation. Nothing in any Sales and Trading Material should be
construed as legal, financial, accounting, tax, or other advice.
PTCP
is a provider of investment banking, broker, dealer, analytics, and financial
advisory services. As such, PTCP may act in various roles including as provider
of underwriting services act as a dealer, purchase or sell as a market maker, holder
of principal positions, broker, or advisor, and may receive fees, brokerage or
commissions for acting in those capacities. In addition, PTCP and associated
personnel may at any time buy, sell, or hold interests in financial instruments
referred to in Sales and Trading Materials either on behalf of clients or as
principal. Therefore, Sales and Trading Materials should not be relied upon as
either independent or objective from the interests of PTCP and associated
personnel which may conflict with your interests.
To
the extent permitted by law, PTCP accepts no responsibility or liability (in
negligence or otherwise) for loss or damage resulting from the use of or
relating to any error, inaccuracy, or incompleteness in Sales and Trading Materials
provided. Sales and Trading Materials have been prepared in good faith and are
based on information obtained from sources believed to be reliable, however, PTCP
is not responsible for information stated to be obtained from third party
sources. Any modelling, scenario analysis, past or simulated past performance
(including back-testing) contained in the Sales and Trading Materials is no
indication as to future performance.
Derivatives
Disclosure. Sales
and Trading Materials constitutes a solicitation for entering into a
derivatives transaction only for the purposes of, and to the extent it would
otherwise be subject to, US Commodity Futures Trading Commission Regulations ยงยง
1.71 and 23.605 promulgated under the US Commodity Exchange Act (the "CFTC
Rules"). Futures options and derivatives products are not suitable for all
investors and trading in those instruments involves substantial risk of loss.
For
important product or country-specific disclosures please refer to https://www.performancetrust.com/regulatory-disclosures.
PT
Score Disclosure
PT
Score™ is a propriety risk assessment system created using numerous call report-based
ratios selected by PTCP. PT Score™ is uses bank level data and does not
incorporate holding company leverage or any other consolidated financial
metrics. PT Score™ is based on unadjusted call report data and does not
incorporate adjustments for one-time or other unusual items. An institution's PT
Score™ corresponds to a CAMELS equivalent rating to help provide an accurate
picture of such institution's level of risk. An institution's score ranges from
0 to 500. The higher an institution's PT Score™, the higher the implied level
of risk.
Electronic
Communications Disclosure
This message and any attachments are for the intended recipient only, and may contain information that is privileged, proprietary, confidential and/or the exclusive property of Performance Trust Capital Partners, LLC ("PTCP") a SEC-registered broker-dealer and a member of FINRA/SIPC/NFA. PTCP's principal place of business is 500 W. Madison Street, Suite 450, Chicago, IL 60661. If you are not the intended recipient, please immediately delete and/or destroy all copies of this message and attachments and kindly notify the sender. Any unauthorized review, use, disclosure or distribution is prohibited.
This document
is directed at institutional investors only, is not intended for retail
investor use, and must not be forwarded or shared with retail investors. This
communication is for general information purposes only and may constitute a
solicitation derivatives business generally, only for the purposes of, and to
the extent it would otherwise be subject to, CFTC Regulations 1.71 and 23.605.
This message is not intended as
an offer, solicitation, or confirmation of transaction for the purchase or sale
of any product or service. It does not constitute a recommendation or take into
account the particular investment objectives, financial conditions, or needs of
specific investors. Past performance is no guarantee of future results.
Investing involves risks, including the potential for principal loss. Any
comments or statements in this message do not necessarily reflect those of PTCP. PTCP
and its affiliates do not provide tax, legal or accounting advice. This
material has been prepared for informational purposes only, and is not intended
to provide, and should not be relied on for, tax, legal or accounting advice.
You should consult your own tax, legal and accounting advisors before engaging
in any transaction.
PTCP and its associated persons may have material interests that conflict with the interests of the recipient of this document. PTCP and its respective officers, directors, partners, and employees may maintain a long or short position in, purchase or sell as market-makers, or act as brokers or commercial and/or investment bankers in relation to any security including financial products of a companies mentioned in this document.
Any content contained herein is as of the date of this e-mail, is not warranted as to completeness or accuracy. Historical prices and values are as of the date indicated, all of which are subject to change without notice. PTCP does not accept any responsibility for the contents of any electronic communication or for any delays, inaccuracies or omissions in the transmission of orders or other information to PTCP and disclaims all liability to the fullest extent permitted by applicable law for any loss, damage, or delay arising from any reliance on or use of this message in any way.
This message may not be reproduced, redistributed or disseminated, without the prior written consent of PTCP. PTCP does not guarantee that communications transmitted electronically are secure, accurate or complete as information could be intercepted, tampered with, corrupted, lost, destroyed or delayed or could contain malicious content. Although this message and any attachments are believed to be free of any malicious content or other defect that might affect any computer system into which it is received and opened, it is the responsibility of the recipient to ensure that it is free of malicious content. By messaging with PTCP, you understand and accept all risks associated with electronic communications.
Any electronic communication conducted within or through PTCP's systems is subject to monitoring, review, retention and external production in order to comply with relevant laws, regulations and regulatory requests, for risk management or operational purposes; may be stored or otherwise processed in countries other than the country in which you are located; and will be treated in accordance with PTCP's policies and applicable laws and regulations. Please notify sender or, if available, use the unsubscribe function if you do not wish to receive further similar emails.
For important
disclosures related to materials prepared by PTCP Sales, Trading, and
Analytics personnel as well as product or country-specific disclosures please refer to https://www.performancetrust.com/regulatory-disclosures.
In addition, this message and any related attachments may be subject to PTCP's
terms and conditions available at https://www.performancetrust.com/terms-and-conditions-of-use
and privacy policy available at https://www.performancetrust.com/privacy-policy.
International Regulatory Disclosures
Asia
Performance
Trust Capital Partners, LLC ("PTCP") is a SEC-registered broker-dealer and
member of FINRA/SIPC/NFA. These disclosures apply to all data, models or
modeling, information from back-testing, communications, videos, publications,
speaking engagements, and all written materials in any format whatsoever
whether related to services or otherwise (collectively, "information") to you
from PTCP and are intended only for institutional investors as defined by FINRA
Rule 2210(a)(4), qualified institutional buyers as defined in Rule 144A under
the Securities Act of 1933, as amended; a "Professional Investor" as
defined in the Securities and Futures Ordinance (the "SFO") and /or the
Securities and Futures (Professional Investor) Rule ("Professional Investor
Rules") and / or the SFC's Code of Conduct for Persons Licensed by or
Registered with the Securities and Futures Commission ("Code of
Conduct"); or a "per se professional client" or an "elective professional
client" as defined by the FCA's Conduct of Business Rules. You should notify us
immediately if, at any point in time, you consider that you would no longer
fall within one of the above definitions of an institutional or professional
investor/client.
This
disclosure serves as notice to clients resident in Asia that PTCP relies on the
following conditions being met to do business with clients domiciled in Asia: clients
qualify as a "Professional Investor", have certified their consent to
be treated as an Institutional Professional Investor, and possess the
knowledge, expertise and experience in financial matters, products and markets
and are aware of and understand the inherent risks involved in the trading of
securities and financial products. Materials relating to securities business
are distributed in Hong Kong to "professional investors" as defined by the
Securities and Futures Ordinance ("SFO") for the Hong Kong Special
Administration Region only.
United
Kingdom ("UK")
Performance
Trust Capital Partners, LLC ("PTCP") is a SEC-registered broker-dealer and
a member of FINRA/SIPC/. These disclosures apply to all data, models or
modeling, information from back-testing, communications, videos, publications,
speaking engagements, and all written materials in any format whatsoever
whether related to services or otherwise (collectively, "information") to you
from PTCP and are intended only for institutional investors as defined by FINRA
Rule 2210(a)(4), qualified institutional buyers as defined in Rule 144A under
the Securities Act of 1933, as amended; a "Professional Investor" as
defined in the Securities and Futures Ordinance (the "SFO") and /or the
Securities and Futures (Professional Investor) Rule ("Professional Investor
Rules") and / or the SFC's Code of Conduct for Persons Licensed by or
Registered with the Securities and Futures Commission ("Code of
Conduct"); or a "per se professional client" or an "elective professional
client" as defined by the FCA's Conduct of Business Rules. You should notify us
immediately if, at any point in time, you consider that you would no longer
fall within one of the above definitions of an institutional or professional
investor/client.
This
disclosure serves as notice to clients resident in the UK that PTCP relies on
the following conditions being met to do business with clients domiciled in the
UK: clients qualify and will be treated as a "per se professional client" or an
"elective professional client" as defined by the FCA's Conduct of Business
Rules ("Rules"). A Professional Client is deemed to possess the experience and
knowledge to make its own investment decisions and assess the risks arising,
and hence is not entitled to certain regulatory protections available to a
"retail client" (as defined by the Rules).
Canada
Performance Trust Capital Partners,
LLC ("PTCP") is a SEC-registered broker-dealer and a member of FINRA/SIPC/.
PTCP's principal place of business is in Chicago, IL (USA). This disclosure
serves as notice to PTCP's Canadian clients of PTCP's transacting in
securities.
PTCP relies upon the international
dealer exemption from the dealer registration requirement under NI 31-103 and
is only permitted to trade "foreign securities" (i.e., non Canadian) with clients
resident in Canada. A foreign security is a security issued by an issuer
incorporated, formed or created under the laws of a foreign (i.e.,
non-Canadian) jurisdiction or a security issued by a government of a foreign
jurisdiction. This serves as notice that clients residing in Canada should only
place orders with PTCP in foreign securities. Additionally, there may be difficulty enforcing
legal rights against PTCP because it resides outside of Canada and all of its
assets are situated outside of Canada.
The
below list contains PTCP's agent for service process for each applicable
province in Canada:
ONTARIO
DLA Piper
Suite 6000, 1 First Canadian Place
PO Box 367
100 King St W
Toronto, Ontario M5X 1E2
Attn: Eric Belli-Bivar
BRITISH COLUMBIA
Victoria Corporate Records Ltd.
4529 Melrose Street
Port Alberni, British Columbia
Canada V9Y 1K7
Fixed Income Securities' Risks Disclosures
Interest Rate Risk. All bonds are susceptible to fluctuations in interest rates. If interest rates rise, bond prices will generally decline, despite the lack of change in both the coupon and maturity. The degree of price volatility due to changes in interest rates is usually more pronounced for longer-term securities
Inflation Risk. Inflation risk is a risk that the income generated may be lower than the rate of inflation. Inflation may diminish the purchasing power of a bond's interest and principal.
Credit and Default Risk. Bonds and their issuers generally receive a credit grade rating by independent rating agencies. Changes in credit rating can also affect prices. If one of the major rating services lowers its credit rating for a particular issue, the price of that security usually declines. Less creditworthy issuers may be more likely to default on interest payments or principal repayment. If a bond issuer fails to make either a coupon or principal payment when they are due or fails to meet some other provision of the bond indenture, it is said to be in default.
Call Risk. Some bonds have call features, which means they can be redeemed or paid off at the issuer's discretion before maturity. Typically, an issuer will call a bond when interest rates fall, potentially leaving investors with a capital loss or loss in income and less favorable reinvestment options.
Liquidity Risk. If a
bond is not traded on a regular basis, the market for this bond may not be
considered liquid. This can be attributed to the large number of issuers and
variety of securities. For example, with limited exceptions for some large more
actively traded issues, the chances of finding a specific municipal bond in the
secondary market at any given time are relatively small. Selling prior to
maturity can present a challenge for municipal bond investors due to the
fragmented and thinly traded nature of the market.
Bond/Issuer Types Additional Risks:
Corporate Bond Risk. Corporate bonds are susceptible to all the risks described above. In addition, a corporate bond's payments are dependent on the issuer's ability to generate cash flow. Unforeseen events could impact their ability to meet those commitments. Corporate bond issuers fall into four main sectors: industrial, financial, utilities, and transportation. Bonds in these economic sectors can be affected by a range of factors, including corporate events, consumer demand, changes in the economic cycle, changes in regulation, interest rate and commodity volatility, changes in overseas economic conditions, and currency fluctuations. Many corporate bonds may have call provisions, which means they can be redeemed or paid off at the issuer's discretion prior to maturity. Typically an issuer will call a bond when interest rates fall potentially leaving investors with a capital loss or loss in income and less favorable reinvestment options.
Government / Agency Bond Risk. While Government Sponsored Entities ("GSE") and agency bonds have relatively low credit risk, there is some risk that the issuing agency or GSE will default. GSE and agency bonds are not an obligation of the U.S. government; credit and default risks are based on the individual issuer. Yields on GSE and agency bonds are usually higher than those offered by treasuries, there is a risk that the income generated may be lower than the rate of inflation. Inflation may diminish the purchasing power of a bond's interest and principal. Some agency or GSE bonds have call features, which means they can be redeemed or paid off at the issuer's discretion before maturity. Typically, an issuer will call a bond when interest rates fall, potentially leaving investors with a capital loss or loss in income and less favorable reinvestment options.
Municipal Bond Risk. Municipal bonds are susceptible to all the risks described above. Most municipal bonds are not traded on a regular basis; therefore, the market for a specific municipal bond may not be particularly liquid. This can be attributed to the large number of municipal issuers and variety of securities. With limited exceptions for some large more actively traded issues, the chances of finding a specific municipal bond in the secondary market at any given time are relatively small. Selling prior to maturity can present a challenge for municipal bond investors due to the fragmented and thinly traded nature of the market. With revenue bonds, the interest and principal are dependent on the revenues paid by users of a facility or service, or other dedicated revenues including those from special taxes. In general, the consumer spending that provides the funding or income stream for revenue bond issuers may be more vulnerable to changes in consumer tastes or a general economic downturn than the income stream for general obligation bond issuers. A key investor consideration for a project financed with revenue bonds is whether such facility delivers fundamental or essential services, such as water and sewer, as they may be more likely to have dependable revenues through multiple economic cycles. Many municipal bonds carry provisions that allow the issuer to call or redeem the bond prior to the actual maturity date. An issuer will typically call bonds when prevailing interest rates drop, making reinvestment less desirable for the holder. Some municipal bonds, including housing bonds and certificates of participation (COPs), may be callable at any time regardless of the stated call features. In some cases, bond issuers will call bonds to modify an indenture through a new offering. Special or extraordinary redemption provisions are provisions that give a bond issuer the right to call the bonds due to a one-time occurrence, such as a natural disaster, interruption to a revenue source, unexpended bond proceeds, or cancelled projects.
Mortgage and Asset Backed Bond Risk. Mortgage-backed securities are unsecured bonds or debentures of pass-through securities backed by pools of mortgages and issued by one of the following U.S. government-sponsored agencies: Government National Mortgage Association ("GNMA"); Federal National Mortgage Association ("FNMA") and Federal Home Loan Mortgage Corporation ("FHLMC"). Bonds or debentures issued by government agencies, including Fannie Mae and Freddie Mac, are generally backed only by the general creditworthiness and reputation of the government agency issuing the bond or debenture and are not backed by the full faith and credit of the U.S. government. Mortgage-backed securities are subject to prepayment risk and extension risk. During periods of rising interest rates, certain debt obligations may be paid off substantially more slowly than originally anticipated and the value of those securities may fall sharply, resulting in a decline in income and potentially in the value of the investment. Because of these risks, mortgage-backed securities react differently than other bonds to changes in interest rates. Small movements in interest rates (both increases and decreases) may quickly and significantly reduce the value of certain mortgage-backed securities. Investments in mortgage-related and other asset-backed securities are subject to the risk of significant credit downgrades, illiquidity, and defaults to a greater extent than many other types of fixed-income investments. During periods of falling interest rates, mortgage- and asset-backed securities may be called or prepaid, which may result in having to reinvest proceeds in other investments at a lower interest rate.
Preferred Securities Risk. Preferred securities have characteristics of both stocks and bonds, and therefore may be subject to the risks of both the equity and bond markets. Many preferred securities carry a payment deferral feature, which allows the issuer, at its discretion, to suspend or defer all or a portion of dividend or interest payments. Payments, if suspended or deferred, may be cumulative or non-cumulative. In the case of non-cumulative preferred securities, deferred payments due not accumulate if unpaid, and the issuer is under no obligation to pay the missed payments in the future. If payments are deferred, usually the company is also no longer permitted to pay dividends on other securities ranked either equally, or lower, in the hierarchy of the company's capital structure. As a result, holders of noncumulative securities carry a greater potential risk of losing an important source of total return, whereas cumulative preferred shareholders may be able recoup lost income if a company is able to return to financial health and make up the missed payments. Many preferred securities carry call or other early redemption provisions that allow the issuer to redeem the security upon certain events or at its discretion. An issuer will often exercise a call provision when prevailing interest rates drop below the rate at which the security was originally issued. Many preferred securities include a conditional call option, allowing the issuer to redeem the securities at the liquidation value upon the occurrence of certain events (e.g. tax law changes disallows the deductibility of payments by the issuer's parent company, or subjects the issue to taxation separate from the parent company). Certain preferred securities permit the issuer, at its discretion, to extend the maturity date (if any) one or more times, which would ultimately delay final repayment of the security's principal. Certain preferred securities may not be able to be readily redeemed (liquidated) or may only be liquidated at a deep discount to par (face) value due to a limited secondary market for the securities.
Inflation Protected Bond Risk. The
interest payments of TIPS are variable, they generally rise with inflation and
fall with deflation.
Floating Rate Bond Risk. Floating-rate loans generally are subject to restrictions on resale. They sometimes trade infrequently in the secondary market, so may be more difficult to value, buy, or sell. A floating-rate loan might not be fully collateralized, which may cause it to decline significantly in value.
High Yield Bond Risk. These
are lower-quality debt securities that involve greater risk of default or price
changes due to potential changes in the credit quality of the issuer.
US government backed/sponsored MBS Primary Dealer
Disclosure
From time to time as the parties mutually agree, Performance
Trust Capital Partners, LLC ("PTCP" or the "Firm") may
act as a Primary Dealer of mortgage pools of US government backed/sponsored MBS
pass-through securities. Below please find agency links to related Offering
Documentation, which may be requested in conjunction with a Firm offer or sale
of such securities.
Freddie Mac
https://capitalmarkets.freddiemac.com/mbs/legal
Fannie Mae
Ginnie Mae
https://www.ginniemae.gov/investors/multiclass_resources/Pages/baseProspectuses.aspx
