On the Right Note: May 2026

On the Right Note is Raison's regular analytical digest covering our structured notes portfolio. Each issue goes beyond the numbers — we break down the market context, explain how protective mechanisms work, and track strategy performance on real observation dates. The digest helps note holders better understand their assets and gives prospective investors a clear picture of how protection features work in practice.

May: Record Highs and a Return of Risk Appetite

May 2026 was another strong month for global markets. US indices reached all-time highs, and the S&P 500 closed its ninth consecutive week of gains — the best run since late 2023. European and Chinese markets remained broadly stable, posting neutral-to-moderately positive returns. An improving geopolitical backdrop gave investors additional confidence to take on risk.

Between May 1 and May 31, 2026, observation dates passed for 9 notes:

• 9 notes remained active, including one individual strategy.
• 0 notes were called early via Autocall.
• Memory Effect was triggered on 2 active notes.

Market Environment and Key Events

May became one of the strongest months of the year, driven by two converging factors:

• Strong earnings season: Most companies beat analyst expectations — 81% on revenue and 85% on earnings per share.
• Easing geopolitical tensions: Despite the absence of formal agreements, key parties avoided escalation. This reduced uncertainty and supported demand for risk assets.

Key indicators as of May 29, 2026:

• S&P 500: +10.73% YTD
• Nasdaq 100: +20.13% YTD
• Russell 2000: +16.39% YTD
• Euro Stoxx 600: +5.51% YTD
• CSI 300: +4.94% YTD
• VIX: 15.92 — reflecting sustained calm across markets.

Impact on Structured Notes

New highs in US equities and lower volatility had a positive effect on structured products. As underlying assets move higher, the buffer above protective barriers widens — reducing the risk of barrier breaches and supporting coupon payments.

Notes in Detail

From market trends to the actual numbers. Below are the note cards for all observation dates that fell in May, grouped into three categories: Active — notes that continue to run, Autocalled — notes that closed early, and those in which the Memory Effect was triggered.

Each card includes:

• Basket composition: the underlying assets we are tracking.
• Coupon status: whether the payment was confirmed for this period.
• Actual income: how much the investor earned per $100,000 invested.

Active Notes

Memory Effect

On two notes, Software and Semiconductors, some underlying assets were below the coupon barrier on the observation date. Under the note terms, coupons are not lost: they are recorded and will be paid once the underlying assets recover.

Why the Memory Effect Was Triggered

The situation with Doximity has not changed materially over the past month. The stock remains slightly below the coupon barrier, and the same factor continues to weigh on it: the MFN rule prompted major pharmaceutical clients to temporarily reassess their marketing budgets.

The investment thesis remains intact. The company maintains strong fundamentals — positive cash flow, a leading market position, and active development of AI-powered tools. Given the small gap to the barrier, recovery by the next observation date remains a realistic scenario.

Why the Memory Effect Was Triggered

On the May 22 observation date, SMCI remained below the coupon barrier; the situation had not changed significantly since our April issue. The coupon for the period has been recorded under Memory Effect and will be paid once levels recover.

That said, recent weeks have brought encouraging momentum. SMCI gained 73% since the start of May. The company continues to benefit from growing demand for AI infrastructure and, late in the month, joined the European AI Cloud Partnership — an initiative through which private companies are helping to build sovereign AI infrastructure for the European Union.

ENPH rose 88% over the same period. Strong earnings from First Solar lifted sentiment across the entire solar sector, while the successful launch of pre-orders for new GaN-based inverters opened a new commercial customer segment for the company.

Both assets are gradually recovering, and we view the current situation as a temporary deviation from the base case. Accumulated coupons are not lost and will be paid once the underlying assets return above their respective levels.

Summary and Outlook

May was a strong month for the structured notes portfolio: all 9 notes, including the individual strategy, remained active. Memory Effect was triggered on 2 notes — the coupons have been recorded and will be paid once the underlying assets recover. The momentum in the semiconductor sector increases the likelihood that this will happen as early as the next observation period.

We continue building products around key macro trends, combining strong yield potential with reliable protective mechanisms.

Interested in learning more about Raison structured notes? Please contact our expert to get a personal consultation.