What happens with the increases in value for accelerated trackers and boosters?

The increases in value for accelerated trackers and boosters being amplified while losses remain regular is a crucial feature of these financial instruments. Accelerated trackers and boosters are designed to provide greater exposure to price movements of the underlying asset compared to traditional tracking products.

When the value of the underlying asset increases, these products often use leverage or enhanced structures to amplify that increase. This means that a small rise in the asset price can lead to a significantly larger gain for the investor, thanks to the mechanics of the tracker or booster. They are structured to enhance positive performance relative to the index or asset they are tracking, making them appealing to investors looking for higher returns in bullish market conditions.

Conversely, while the mechanism amplifies gains, it typically does not enhance the losses in the same way. When the underlying asset loses value, the decline might impact the investment without further leverage, maintaining a more conventional response to the negative price movement. This characteristic allows investors to enjoy the benefits of accelerated growth potential while being mindful that their losses will not expand in the same dramatic fashion.

Understanding this feature is essential for investors, as it highlights the potential rewards and risks associated with using such leveraged financial products in their investment strategies.