AMC (Actively Managed Certificate)
An actively managed certificate is an ISIN-bearing security whose value tracks a discretionary investment strategy that a manager continues to run. It is issued from a ring-fenced compartment of a bankruptcy-remote vehicle rather than by a fund, so there is no collective investment scheme behind it and no published index to follow. Investors buy it through their own bank against the ISIN and hold it in an ordinary custody account. Because it carries no rulebook, an AMC is the usual wrapper for a strategy whose value is the manager's judgement, and it is distributed to professional investors only.
Read the AMC guide →Tracker certificate
A tracker certificate is an ISIN-bearing security that mirrors the value of a defined underlying — a fund, a portfolio, an index or a basket — on a stated basis, usually one for one. Unlike an actively managed certificate, its composition follows a published methodology rather than a manager's discretion, which makes it simpler to value and easier for an allocator to diligence. Tracker certificates are commonly used to make an underlying that a bank cannot otherwise hold available inside standard custody infrastructure, and to give a rules-based strategy a bankable form.
Tracker certificates explained →ETP (Exchange-Traded Product)
An exchange-traded product is an ISIN-bearing security admitted to trading on an exchange, whose value tracks an underlying asset, index or strategy. In Europe the term usually covers securitised products issued from a compartment rather than regulated funds: an ETP is a note or certificate, so it can hold exposures a retail fund cannot, and it is a professional-investor instrument. Admission requires an approved disclosure document, an underlying that can be valued continuously, settlement eligibility and a continuous market-making commitment.
ETP issuance overview →ETN (Exchange-Traded Note)
An exchange-traded note is a listed debt security whose return is linked to a defined underlying. The distinction that matters is what stands behind it: an ETN is an obligation of its issuer, so a holder is exposed to that issuer's ability to pay as well as to the underlying's performance. Collateralised structures reduce that exposure by holding assets in the issuing compartment for the benefit of noteholders, which is why European professional buyers increasingly treat collateralisation as a threshold question rather than a feature.
What is an ETN? →ETC (Exchange-Traded Commodity)
An exchange-traded commodity is a listed security giving exposure to a single commodity or a commodity basket — precious metals, energy, agricultural products — either by holding the physical asset or through derivative exposure. It exists as a separate category because commodities generally cannot be held inside a regulated European retail fund, so the securitised note or certificate form is the practical route to a listed commodity product. Whether an ETC is physically backed or synthetically replicated is the first thing an allocator will ask.
CLN (Credit-Linked Note)
A credit-linked note is a debt security whose coupon and redemption depend on the credit performance of a defined reference — a single obligation, a basket or a portfolio. If a credit event occurs, the note's principal is reduced by reference to the recovery on the reference obligation rather than repaid in full. CLNs are used to package private credit, project finance, corporate credit and secured lending exposure into an ISIN-bearing instrument that professional investors can hold at their own bank and that fixed-income mandates can accommodate.
How to issue a CLN →Structured note
A structured note is a debt-shaped security whose return is defined by reference to an underlying asset, index or event rather than by a plain interest rate. The category covers credit-linked notes, secured notes over identified assets, participation notes and payoff-defined instruments generally. What distinguishes a structured note from a portfolio certificate is the shape of the promise: a note states what the holder receives, on which dates, subject to defined conditions, whereas a certificate simply reflects whatever the underlying portfolio is worth at each valuation.
Securitisation
Securitisation is the practice of transferring a defined pool of assets or cash flows into a vehicle that exists only to hold them, and funding that vehicle by issuing securities against the pool. The purpose is separation: investors take exposure to the assets rather than to the originator's balance sheet, and the originator recycles capital into new business. The technique is used for loan books, receivables, real-asset income and investment strategies alike, and it underlies certificates, notes and exchange-traded products issued from compartments.
What is securitisation? →Securitisation vehicle
A securitisation vehicle is a legal entity created to hold assets or exposures and to issue securities backed by them, on a limited-recourse and bankruptcy-remote basis. Its constitution restricts it to that purpose, which is what allows investors to look through to the assets rather than to a wider corporate group. Most such vehicles are divided into compartments, cells or segregated portfolios so several unrelated transactions can be issued from one entity without any exposure between them.
Securitisation vehicles guide →Compartment
A compartment is a legally segregated pool of assets and liabilities inside a securitisation vehicle. Under the Luxembourg framework the segregation is statutory: the assets of one compartment answer only for that compartment's liabilities, so investors in one product have no exposure to any other product issued by the same vehicle. This ring-fencing is the feature that makes shared issuance infrastructure acceptable to institutional investors, and it is the point on which structures issued from a common platform should be examined most closely.
Luxembourg compartments →PCC (Protected Cell Company)
A protected cell company is a single legal entity, used notably in Guernsey, that contains a core and any number of statutorily ring-fenced cells. Each cell holds its own assets and liabilities, protected by statute from the creditors of every other cell and of the core, and a new product is launched by creating a new cell rather than a new company. That is what makes the structure fast: the entity, its governance and its supervision already exist, and the incremental step is the cell itself.
Guernsey PCC guide →SPC (Segregated Portfolio Company)
A segregated portfolio company is the Cayman Islands equivalent of a protected cell company: one legal entity containing multiple segregated portfolios, each ring-fenced by statute from the others. Each portfolio holds its own assets, issues its own securities and is insulated from the creditors of every other portfolio in the company. SPCs are widely used for master-feeder arrangements, multi-strategy programmes and products distributed to investors outside Europe, whose custodians are long familiar with the format.
Cayman SPC guide →SPV (Special Purpose Vehicle)
A special purpose vehicle is a company established to perform one narrowly defined function — typically to hold defined assets and issue securities against them — and prohibited by its own constitution from doing anything else. The narrowness is the point: it limits what liabilities the entity can ever incur, which is what allows investors to assess the assets rather than an operating business. In structured product issuance the SPV is the issuer, and it is deliberately independent of the manager whose strategy the security tracks.
Bankruptcy-remote SPVs →Orphan SPV
An orphan SPV is a special purpose vehicle whose shares are not owned by the transaction's sponsor or originator, but are held instead by an independent party under a charitable or purpose trust arrangement. Orphaning removes the vehicle from the sponsor's group, so it is not consolidated onto the sponsor's balance sheet and would not be drawn into the sponsor's insolvency. It is a standard technique where investors need certainty that the issuer is genuinely separate from the party that arranged the transaction.
Bankruptcy remoteness
Bankruptcy remoteness is the set of structural features that insulate an issuing vehicle from the insolvency of its sponsor, its manager and its other transactions. It is achieved through a restricted corporate purpose, limited-recourse and non-petition provisions in the documentation, statutory segregation between compartments, and often an orphan ownership structure. It does not mean the vehicle cannot fail — it means that if something else fails, the vehicle and its assets are not pulled in. It is the premise on which investors take asset risk rather than counterparty risk.
True sale
A true sale is a transfer of assets that would survive the seller's insolvency: legal title passes to the purchasing vehicle, and the assets form no part of the seller's estate if the seller later fails. It is the distinction between a securitisation and a secured loan dressed as one, and it is established with legal opinions in each relevant jurisdiction rather than asserted in the documentation. If a court could re-characterise the transfer as secured lending, the bankruptcy remoteness investors are relying on would not hold.
ISIN (International Securities Identification Number)
An ISIN is the twelve-character international identifier assigned to a security so that it can be booked, transferred and settled unambiguously across banks, custodians and clearing systems. It is allocated by a national numbering agency as part of issuing the security. The identifier is a label rather than the thing itself: an ISIN exists because a security has been created, documented and admitted for settlement, and a code without a structure behind it will not let anyone buy or hold anything.
From strategy to ISIN →Valoren (Swiss security number)
The valoren number, or Valorennummer, is the Swiss national security identifier, allocated by the Swiss numbering agency alongside the ISIN. It is shorter than an ISIN and is the reference Swiss banks, trading systems and client statements have historically used domestically. A security issued with a Swiss ISIN normally carries a valoren as well, and Swiss custodians will often quote it in preference to the ISIN in client-facing reporting, so it is worth having both to hand when a product is being onboarded.
Swiss ISIN issuance →Common code
A common code is a nine-digit identifier assigned jointly by the two international central securities depositaries to a security accepted for settlement in their systems. It is issued alongside the ISIN and is the reference those systems use internally to identify the instrument. In practice it appears in issuance and settlement documentation rather than in client statements, and its presence is a signal that the security has been accepted for international settlement rather than only allocated an identifier.
Paying agent (role)
The paying agent is the role responsible for processing subscriptions, redemptions and any coupon or redemption payments on a security, and for interfacing between the issuing vehicle, the settlement system and investors' banks. It is a regulated function performed by a licensed institution appointed for each transaction; the identity of that institution is set out in the transaction's own documentation rather than described generically here. Without a paying agent there is no route for cash to move against the security in either direction.
Paying agent explainer →Calculation agent (role)
The calculation agent is the role responsible for computing the value of a security in accordance with the methodology set out in its terms — the net asset value of a certificate, or any performance-linked amount payable under a note. The function is deliberately independent of the party whose strategy is being valued, because the credibility of the published figure depends on someone other than the manager producing it. The methodology, the valuation frequency and the price sources are all fixed in the documentation before issuance.
Custodian (role)
A custodian is a regulated institution that holds securities or assets on behalf of a client and settles transactions in them through the relevant depositary. Two custody relationships matter in a structured product: the custody of the assets the issuing vehicle holds, and the custody of the security itself in the investor's own account. Making a product bankable means ensuring the second of these works — that the investor's existing bank can receive the security against payment without needing any new capability.
NAV (Net Asset Value)
Net asset value is the per-unit value of a certificate at a given valuation date: the value of the assets held, less the liabilities attributable to them, divided by the number of units outstanding. It is the reference used for subscriptions, redemptions and investor reporting, and it is struck by the calculation agent on the basis and at the frequency the terms specify. A valuation frequency the underlying assets cannot actually support is one of the more common structuring errors, and it is easier to fix before launch than after.
Subscription and redemption
Subscription is the issuance of new units of a security to an investor against payment; redemption is the cancellation of units in exchange for a cash amount calculated at the applicable net asset value. Both run through the paying agent and settle against the investor's own custodian. The terms fix the mechanics that matter in practice: dealing frequency, notice periods, settlement lag, and any limits or gates. Where the underlying assets are illiquid, redemption is normally restricted rather than open, because the vehicle cannot fund an exit the assets will not support.
Listing
Listing is the admission of a security to trading on an exchange, so that it can be bought and sold on that venue rather than only transferred between custodians. It requires an approved disclosure document, an underlying that an independent party can value continuously, settlement eligibility and a continuous market-making commitment, and each of those is an ongoing obligation rather than a launch formality. A listing is what a product needs when its buyers are diffuse; where the buyers are a known list, an unlisted security reaches them sooner.
ETP listing venues →Base prospectus
A base prospectus is the programme-level disclosure document under which a series of securities can be issued over time, with the specifics of each issue set out in separate final terms rather than in a new document each time. It is the mechanism that makes a securitisation programme efficient: once approved, a further issue is a documentation exercise against the existing base rather than a fresh approval cycle. Public offers and admissions to a regulated market generally require an approved prospectus; private placements to professional investors typically rely on exemptions.
Private placement
A private placement is an offer of securities made to a defined group of professional or qualified investors rather than to the public, in reliance on the exemptions that regime provides from full prospectus and packaged-product disclosure. It is how most unlisted certificates and notes are distributed. The exemptions available differ by country, so the marketing restrictions are drawn against a specific list of target markets at structuring, and adding a country afterwards is a documentation exercise rather than a decision.
Qualified investor
A qualified investor is an investor that meets the criteria set by the applicable regulator — for example under FinSA in Switzerland — and can therefore be offered products not available to retail clients. The category typically covers regulated financial institutions, large corporates, institutional investors, and private clients who meet defined wealth or knowledge thresholds and have opted in. Structured products issued from securitisation compartments are offered to qualified investors only, and the eligibility test is applied by the distributing institution before an investor may subscribe.
Professional client (professional investor)
A professional client is an investor treated under MiFID II as possessing the experience, knowledge and expertise to take investment decisions and assess the associated risks. Some clients are professional per se — credit institutions, investment firms, large undertakings — and others may be treated as professional on request if they meet defined tests. The classification matters because it determines what may be offered, what disclosure is required and which investor-protection rules apply, and it is applied by the firm dealing with the client rather than by the issuer.
MiFID II
MiFID II is the European directive and accompanying regulation governing investment services and markets in financial instruments. For structured product issuance its relevance is mostly definitional and distributional: it sets the professional-client and eligible-counterparty categories, and it imposes product governance obligations under which a manufacturer must define a target market and a distributor must sell within it. It applies to the firms dealing with investors rather than to the issuing vehicle, but it shapes what the documentation has to say about who the product is for.
FinSA / FIDLEG
The Financial Services Act — FinSA in English, FIDLEG in German — is the Swiss regime governing how financial services are provided and financial instruments offered in Switzerland. It sets the client segmentation between retail, professional and institutional clients, defines the circumstances in which a prospectus or key information document is required, and governs conduct at the point of sale. It is the Swiss counterpart to MiFID II for these purposes, and it is the framework that applies when a certificate is placed with qualified investors in Switzerland.
AIFMD
The Alternative Investment Fund Managers Directive is the European regime governing managers of funds that are not UCITS — hedge funds, private equity funds, real estate funds and similar. It regulates the manager rather than the product, and it governs marketing to EU professional investors through a passport or through national private placement regimes. Its relevance to securitisation is boundary-drawing: a securitisation vehicle issuing notes against defined assets is generally outside the definition of an alternative investment fund, and where that line sits is a structuring question worth settling early.
White-label (white-label AMC)
A white-label arrangement is one in which a product is issued from a third party's vehicle but carries the client's own name, strategy and investor relationships. In a white-label AMC the client defines and manages the strategy and owns the client relationship; the platform supplies the issuing vehicle, the compartment, the ISIN, the agency roles and the lifecycle administration. It is how a manager launches a branded product without incorporating, capitalising and maintaining an issuing entity of their own.
White-label AMC →Feeder note (feeder structure)
A feeder note is a security issued from a compartment whose purpose is to hold a single underlying exposure — typically a fund interest, a partnership interest or a private-markets commitment — and pass its economics through to holders. It makes an otherwise indivisible and non-bankable interest divisible, transferable and holdable in an ordinary custody account. It does not make the underlying liquid: a feeder into an illiquid asset is an illiquid instrument, and its redemption terms should say so plainly rather than imply otherwise.
Private-markets feeder note →Tokenised security
A tokenised security is a security whose ownership is recorded on a distributed ledger rather than, or in addition to, a conventional register. Tokenisation changes how a holding is recorded and transferred; it does not change what the instrument is, what it may hold, who may buy it or how it is regulated. Swiss law recognises register-based uncertificated securities directly, which is why a token can be the record of title there. Hybrid structures maintain both a conventional and a tokenised register for the same instrument.
Tokenised and hybrid vehicles →Settlement (Euroclear, Clearstream, SIX SIS)
Settlement is the process by which a security is delivered to a buyer and payment is made to the seller, through a central securities depositary. The venues relevant here are Euroclear and Clearstream, the two international depositaries through which European securities are held and moved, and SIX SIS, the Swiss domestic depositary. They are infrastructure rather than counterparties to a transaction: eligibility in one of them is what allows an investor's own bank to receive a security into a client account without any bilateral arrangement.
DVP settlement
Delivery versus payment is a settlement mechanism in which the transfer of a security and the corresponding cash payment occur simultaneously and conditionally on each other, so neither side can deliver without receiving. It eliminates principal risk — the risk of paying and not receiving, or delivering and not being paid. Subscriptions and redemptions in ISIN-bearing structured products are executed on this basis through the paying agent and the relevant depositary, which is one reason the ISIN route is acceptable to institutions where a bilateral transfer would not be.
Market maker
A market maker is a firm that commits to quoting continuous two-way prices in a listed instrument, so there is always a price at which an investor can buy and one at which they can sell. Exchanges require such a commitment as a condition of admitting an exchange-traded product, and it is a continuing obligation rather than a launch formality. The spread a market maker quotes is what buyers judge the product on, which is why a listing that is too small to support meaningful market making rarely recovers from its opening days.
Authorised participant
An authorised participant is a firm entitled to create and redeem units of an exchange-traded product directly with the issuer, in exchange for cash or the underlying assets. That mechanism is what keeps the traded price close to the value of the underlying: when the price on the venue diverges, creating or redeeming units at the underlying value is profitable, and doing so closes the gap. It is a distinct role from market making, though the same firm often performs both for a given product.
Term sheet
A term sheet is the summary document setting out the defining terms of a security: the issuer and the compartment it is issued from, the identifier, the underlying, the valuation methodology and frequency, the subscription and redemption mechanics, the term or maturity, and the reporting investors will receive. It is the reference document investors and their banks work from, and it is the artefact in which most structuring decisions become binding — which is why the drafting stage is where questions about the underlying and the valuation are best resolved.
Secondary market
The secondary market is where a security changes hands between investors after issuance, as distinct from the primary market in which it is first issued. Unlisted certificates and notes are normally transferred bilaterally between custodians through the depositary, subject to the transfer restrictions in the terms and to the buyer's own onboarding. Listed products trade on their venue with a market maker quoting both sides. A wrapper does not create a secondary market where no buyers exist; it makes a transfer possible when they do.
KID (Key Information Document)
A key information document is the short standardised disclosure required under the European PRIIPs regime for packaged retail and insurance-based investment products, covering what the product is, its risks, its performance scenarios and the length of time it is meant to be held. Whether one is required depends on who the product is offered to: offers restricted to professional investors generally fall outside the regime, while offers that reach retail investors pull it in. It is a distribution question rather than an issuance one, and it is settled when the target markets are.
Securitisation Law of 2004
The Luxembourg law of 22 March 2004 on securitisation, as amended, is the statute governing Luxembourg securitisation undertakings. It defines what such a vehicle may do, establishes the statutory ring-fencing between compartments that gives each transaction its own segregated pool of assets and liabilities, and sets out when authorisation is required — broadly, where securities are issued to the public on a continuous basis. It is the legal foundation for certificates, notes and exchange-traded products issued from Luxembourg compartments.
Luxembourg jurisdiction guide →