Credit Suisse to Redeem Volatility Note After Value Plunges

The video discusses the return of market volatility and its impact on investment products, particularly focusing on a Credit Suisse exchange traded note. The note, which was a bet against volatility, is being bought back by the bank, leading to potential losses for investors. Despite reassurances from Credit Suisse about their own position, the market remains affected, with stocks down. The video further explores the scale of the short volatility trade and the financial exposure involved, highlighting the significant market cap and potential losses.

What is the irony mentioned in the context of market volatility?

• Volatility is decreasing, yet products are failing.

• Investment banks wanted volatility, but now face product issues.

• Banks are profiting from stable markets.

• Volatility is stable, but banks are losing money.

What action did Credit Suisse decide to take in response to rising volatility?

• Increase their investment in volatile markets.

• Buy back an exchange-traded note.

• Sell off their existing notes.

• Launch a new exchange-traded note.

What is the implication for investors due to Credit Suisse's decision to buy back the note?

• Investors will gain a significant profit.

• Investors will lose a large portion of their initial investment.

• Investors will break even.

• Investors will receive a bonus.

What was the approximate market cap of the exchange-traded note discussed?

• 2 billion

• 1.6 billion

• 3 billion

• 500 million

How did Credit Suisse respond to reports of a 500 million loss?

• They confirmed the loss.

• They partially accepted the loss.

• They ignored the reports.

• They denied suffering any losses.