PORTFOLIO OBJECTIVE

The Fund seeks a high rate of current income by investing in Multi Stock Structured Income Notes (MSSIN); however, there is no assurance the objective will be met.

WHAT ARE MULTI STOCK STRUCTURED INCOME NOTES (MSSIN)

  • The notes are investment grade bonds issued by major banks in the US, Canada, and Europe. There are 15 banks that issue these notes.
  • The notes interest rate is based on the volatility of (3) underlying common stocks chosen by American Asset Management.
  • Each note will have a different group of underlying stocks.
  • The interest rate is fixed at the date of issuance and will not fluctuate for the entire term of the note.
  • The interest paid is subject to the performance of the (3) underlying common stocks chosen by American Asset Management.
  • Each note will have a barrier for both coupon payment and maturity payment.
  • At the close of business on the observation date, which is quarterly, if the price of any of the (3) underlying stocks has dropped by more than the chosen barrier i.e. (50%) from the date the note was issued, the interest is not paid.
  • At the close of business on the observation date, which is quarterly, so long as the price of all (3) underlying stocks prices have not dropped by more than the chosen barrier i.e. (50%) from the date the note was issued, the interest for that quarter along with any skipped payments described above, are paid. This is called memory.
  • At the close of business on the maturity date, provided the price of all (3) underlying stocks have not dropped by more than the chosen maturity barrier i.e. (50%) from the date the note was issued, the principal is paid in full.
  • At the close of business on the maturity date, if the price any of the (3) underlying stocks has dropped by more than the chosen maturity barrier i.e. (50%) from the date the note was issued, the bank reduces the principal payment by the exact percentage the worst performing stocks price has declined from the issue date.

PORTFOLIO SELECTION PROCESS

Through our selection process we seek to find the stocks that we believe have the best prospects for not breaching our barriers.

Identify the Universe | We begin with the companies listed in the S&P 500 Index.

Screen the Universe | We then evaluate the companies in the universe based on market price decline over 3-6 year rolling periods. These screens are designed to determine the appropriate coupon and maturity barriers.

Select the Portfolio | The final step is to select the underlying stocks and barriers for each note subject to a maximum weighting of 2% in a single stock.

RISK DISCLOSURE: Liquidity Risk. Structured notes lack an established trading market, and if an investor wants to sell the security before the maturity date, they can only do so in the open market. There may or may not be ready buyers for the structured note, and investors may be forced to sell the investment at a discount of what it is worth. Market Risk. Although some structured notes come with built-in protection levels against losses, investors may still suffer losses when the underlying asset becomes volatile to the risks of the market they are tied to. Linking the structured note to more speculative assets increases the market risk significantly. Default Risk. Structured notes carry a higher default risk compared to other investments. If the note issuer files for bankruptcy, the entire investment could be rendered worthless, regardless of the returns produced by the underlying asset. Structured notes are considered complex and may not be suitable for all investors. Structured Notes are sold only by prospectus and investors should read the prospectus and pricing supplement carefully before investing as they contain a detailed explanation of the risks, tax treatment, and other relevant information about the investment. Investors should consult accounting, legal, or tax professionals before investing. Structured products are sold through financial professionals.

This page is for informational purposes only and is not an offer or solicitation of an offer to buy or sell any product or service. Unless otherwise stated, all information and opinion contained in this publication was produced by American Asset Management, Inc. (AAM) and other sources believed by AAM to be accurate and reliable. Due to rapidly changing market conditions and the complexity of investment decisions, supplemental information and other sources may be required to make informed investment decisions based on your individual investment objectives and suitability specifications. Ver.11.22.2021 American Asset Management, Inc. Copyright 2023