A WAVE XXL that allows investors and traders to take “leveraged” views on upward market direction in an underlying asset (e.g., currencies, indexes, commodities, and in some cases individual stocks), subject to a stop-loss mechanism. The structure has no set maturity, and nevertheless it is equipped with a capital protection feature where the maximum loss to the capital invested cannot go beyond the amount invested.

A WAVE XXL is a securitized product that provides maximum leverage to profit from small movements in the market value of the underlying. As a type of flow derivatives, it is traded on exchanges or other electronic platforms. A WAVE XXL call is held by bullish investors who seek to make a leveraged bet on (and profit from) upward movement in the underlying, subject to a stop-loss control.

The leverage capacity in a WAVE XXL stems from the use of leveraged products like futures or options, where the investor is not required to buy the underlying asset, but rather pay a small premium or put up margin to gain access to the full price movement of the underlying.