Products Disclosures

PROD-010: Bond Advertising - General /Corporate, Muni and Agency

Bonds involve risks including, but not limited to interest rate risk, reinvestment risk, inflation risk, call risk, liquidity risk, credit risk, market risk, default risk, event risk, and a risk of loss of principal. New issue offerings are sold by prospectus or offering circular available by contacting Scottrade. Investors should read these carefully.

PROD-020: Bond Advertising -when discussing both bonds and CDs together

FDIC and SIPC coverage are not the same. Visit www.fdic.gov or www.sipc.org for more information.

PROD-030: CDs

Any CD sold prior to maturity date may be subject to gain or loss. The Federal Deposit Insurance Corporation (FDIC) insures CDs for principal and accrued interest up to $250,000 per depositor per insured bank (FDIC Insurance Explained). Any account or deposits that you may maintain directly with a particular issuer are aggregated with the CDs for purposes of the $250,000 limit. CDs will not be automatically renewed or rolled over, and interest on the CD will not continue to accrue after maturity.

PROD-040: Certificates-of-deposit (CDs) vs brokered CDs

Brokerage products and services offered by Scottrade, Inc. – Member FINRA and SIPC. Deposit products and services offered by Scottrade Bank, Member FDIC. The standard FDIC insurance amount is $250,000 per depositor, per insured bank. In comparison to traditional CDs, brokered CDs are more complex products, carry more risk, and may not be FDIC insured.

Brokerage products are not insured by the FDIC — are not deposits or other obligations of the bank and are not guaranteed by the bank — are subject to investment risks, including possible loss of the principal invested.

PROD-050: Certificates-of-deposit (CDs) and brokered CDs: Print

Brokerage products and services offered by Scottrade, Inc. – Member FINRA (www.FINRA.org) and SIPC (www.SIPC.org). Deposit products and services offered by Scottrade Bank, Member FDIC (www.FDIC.gov). The standard FDIC insurance amount is $250,000 per depositor, per insured bank. In comparison to traditional CDs, brokered CDs are more complex products, carry more risk, and may not be FDIC insured.

Brokerage products are not insured by the FDIC — are not deposits or other obligations of the bank and are not guaranteed by the bank — are subject to investment risks, including possible loss of the principal invested.

PROD-060: Closed-End Funds (CEFs)

Investors should consider the investment objectives, charges, expense and unique risk profile of a closed-end fund (CEF) carefully before investing. A prospectus contains this and other information about the CEF and may be obtained online or by contacting Scottrade.  The prospectus should be read carefully before investing.

PROD-070: Commodities/Futures Disclosure

Commodities and/or futures involve unique risks and are subject to sudden price fluctuations. Please research each investment carefully before investing.

PROD-080: ETF/Mutual Fund

Investors should consider the investment objectives, charges, expense and unique risk profile of an exchange-traded fund (ETF) or mutual fund before investing. A prospectus contains this and other information about the fund and may be obtained online or by contacting Scottrade. The prospectus should be read carefully before investing.

PROD-090: Exchange Traded Funds (ETFs)

Investors should consider the investment objectives, charges, expense, and unique risk profile of an exchange-traded fund (ETF) before investing. A prospectus contains this and other information about the fund and may be obtained online or by contacting Scottrade.  The prospectus should be read carefully before investing.

PROD-100: Exchange Traded Notes (ETNs)

Investors should consider the investment objectives, charges, expense and unique risk profile of an exchange-traded note (ETN) before investing. A prospectus contains this and other information about the ETN and may be obtained online or by contacting Scottrade.  The prospectus should be read carefully before investing.

PROD-110: Indexes

An investment cannot be made directly in an index.

PROD-120: International Investments

International investing can involve substantial risks and is not suitable for all investors. Risks include changes in currency exchange rates; political, economic and social events; potential for illiquid markets; less information; reliance on foreign legal remedies; and different market structures and operations. Investors should fully research any security or strategy before making an investment decision. 

PROD-130: IPO

Before investing in an Initial Public Offering, be sure that you are fully aware of the risks involved with this type of investing. There are a variety of risk factors typically associated with investing in new issue securities, any of which may have a material and adverse effect on the price of the issuer’s common stock. IPOs may not be appropriate for every investor. Customers should read the offering prospectus carefully, and make their own determination of whether an investment in the offering is consistent with their investment objectives, financial situation, and risk tolerance.

PROD-140: Leveraged and Inverse Exchange Traded Funds (ETFs)

Leveraged and inverse ETFs may not be suitable for all investors and may increase exposure to volatility through the use of leverage, short sales of securities, derivatives and other complex investment strategies. These funds’ performance will likely be significantly different than their benchmark over periods of more than one day, and their performance over time may in fact trend opposite of their benchmark. Investors should monitor these holdings, consistent with their strategies, as frequently as daily. 

PROD-150: Margin

Margin trading involves interest charges and risks, including the potential to lose more than deposited or the need to deposit additional collateral in a falling market. Scottrade’s margin agreement is available online or by contacting Scottrade, and contains the Margin Disclosure Statement and information on our lending policies, interest charges, and the risks associated with margin accounts.

PROD-160: Margin - Print

Margin trading involves interest charges and risks, including the potential to lose more than deposited or the need to deposit additional collateral in a falling market. The Margin Disclosure Statement and Agreement (PDF) is available for download at https://www.scottrade.com/documents/formscenter/SF1011_Margin_Agreement.pdf, or it is available by contacting Scottrade. It contains information on our lending policies, interest charges, and the risks associated with margin accounts.

PROD-170: Mutual Funds

Investors should consider the investment objectives, risks, charges and expenses of a mutual fund before investing.  A prospectus contains this and other information about the fund and may be obtained online or by contacting Scottrade.  The prospectus should be read carefully before investing.

PROD-180: Mutual Funds – NTF

No-transaction-fee (NTF) funds are subject to the terms and conditions of the NTF funds program. Scottrade is compensated by the funds participating in the NTF program through recordkeeping, shareholder or SEC 12b-1 fees.

PROD-190: Options

Options involve risk and are not suitable for all investors. Detailed information on our policies and the risks associated with options can be found in the Scottrade® Options Application and Agreement, Brokerage Account Agreement, by downloading the Characteristics and Risks of Standardized Options and Supplements (PDF) from The Options Clearing Corporation, or by requesting a copy by contacting Scottrade. Supporting documentation for any claims will be supplied upon request. 

PROD-200: Options - Print

Options involve risk and are not suitable for all investors. Detailed information on our policies and the risks associated with options can be found in Scottrade's Options Application and Agreement, Brokerage Account Agreement, in the Characteristics and Risks of Standardized Options booklet which can be downloaded from the Options Clearing Corporation website www.optionsclearing.com, ordered by phone at 888-OPTIONS, or by contacting Scottrade. Supporting documentation for any claims will be supplied upon request. 

PROD-210: Options - Collars

The collar option strategy may help protect profits and offer downside protection, but may also limit profit potential and incur additional commissions, fees and charges.

PROD-220: Options - Covered Call

The covered call option strategy may help generate income and offer limited downside protection, but does not provide full downside protection and may limit profit potential.

PROD-230: Protective Puts

A protective put strategy raises the breakeven on the underlying by the amount paid for by the put. If the underlying security stays above the strike price you can lose the entire premium upon expiration.

PROD-240: Uncovered Options

There are special risks associated with uncovered option writing that may expose investors to significant losses. Therefore, this type of strategy may not be suitable for all customers approved for options transactions. Clients approved for uncovered put writing must acknowledge having received and read the Special Statement for Uncovered Options Writers concerning the risks of this type of trading.

PROD-250: Spreads

Although there is income potential from spread trading, there are additional risks which include, but are not limited to: The risk of being assigned on one leg due to early exercise, order execution risk due to the fact that spread orders are not held and are discretionary, order execution risk because all legs of a spread must be executed on the same exchange, and the risk of delayed reporting of executions.

PROD-260: Options Calculations and/or Examples

Examples used will show the deduction, or inclusion, of commissions and other costs that may significantly affect the performance of the given strategy. They do not take into consideration tax consequences or fees with minimal impact on a given strategy. An investor should understand the impact of transaction costs, margin fees and requirements, and tax considerations before entering into any options strategy.

Any strategies discussed, including examples using actual securities and price data, are strictly for illustrative and education purposes and are not to be construed as an endorsement, recommendation or solicitation to buy or sell securities. 

PROD-270: Penny Stocks

Penny stocks can be very risky and investors should research each investment carefully. Contact Scottrade for restrictions concerning penny stocks.

PROD-280: REITs

REITs involve unique risks and are subject to stock market volatility. There is no guarantee regarding future performance, and upon the sale or distribution of the REIT’s assets, stockholders may receive less than their initial investment. Distributions from REITs may be paid from offering proceeds, the sale of assets or borrowed funds. There are fees associated with investments in a REIT and those fees may affect the overall performance of the investment. Please research each investment carefully.