many structured products, especially those that present risks of loss of principal due to market movements, are similar to risks involved with options. Disadvantages of structured products may include: Credit risk – structured products are unsecured debt from investment banks Lack of liquidity – structured products are primarily traded over the counter and issuers are not obligated to provide a bid Highly complex – the complexity of the return calculations means that it is difficult to determine how the structured product would perform versus simply owning the underlying asset Intuition-based methods of product design often produce trades that are mathematically equivalent to gambling. (the above "Quantitative Structuring approach" can be used to eliminate this problem) Lack of clarity on what exact problem the product is actually solving (does not apply to products built through the Quantitative Structuring approach). Lack of transparency on pricing - the investment bank fees are hidden in the product pricing and difficult for the customer to discern More generally, the serious risks in options trading are well-established and customers must be explicitly approved for options trading. The U.S. Financial Industry Regulatory Authority (FINRA) suggests that firms "consider" whether purchasers of some or all structured products should be required to go through a similar approval process, so that only accounts approved for options trading would also be approved for some or all structured products. Further, "principal-protected" products are not always insured by the Federal Deposit Insurance Corporation in the United States; they may only be insured by the issuer, and thus could potentially lose the principal if there is a liquidity crisis or bankruptcy. Some firms attempted to create a new market for structured products that are no longer trading; some have traded in secondary markets for as low as pennies on the dollar. The regulatory framework for structured products is hazy and they may fall in legal grey areas. In India, equity-related structured products may violate the Securities Contract Regulation Act, which prohibits issuing and trading equity derivatives that do not trade on a nationally recognized exchange. Structural Process Securitization Securitization in relation to structured products is the undertaking and pooling of bundles of debt which may include commercial mortgages, residential mortgages, and other debt obligations such as credit cards. Securitization Process It is under the branch of structured finance which relates to the management of leverage and the risk and serves as a very large