> For the complete documentation index, see [llms.txt](https://advisorhub.syntheticfi.com/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://advisorhub.syntheticfi.com/product-learn-more/whats-the-catch-risks.md). # What’s the catch? Risks? {% hint style="info" %} ## Three main risks, all understood and managed for you SyntheticFi has three risks: margin call, interest rate, and execution. All are well understood and no worse than the products your clients already use. SyntheticFi monitors all three for you and works with you to resolve anything that comes up. {% endhint %} Every loan backed by a portfolio carries some risk, and SyntheticFi is no exception. The difference is that its risks are well understood, comparable to or lower than an SBLOC or margin loan, and monitored for you. ### The three main risks 1. **Margin call risk.** Like any portfolio-backed loan, if the market falls far enough the client may need to add cash or securities. You control the cushion by how much the client borrows: the less they borrow, the larger the drop they can withstand before it's ever a concern. If a call does happen, the process is custodian-led and gives the client a few business days to respond. [Margin call process →](/product-deep-dive/margin-call-process.md) 2. **Interest rate risk.** If a client locks in a fixed rate and benchmark rates later fall, the loan won't automatically adjust down. Clients who want to stay flexible can use the floating-rate option, which moves with the market. [Interest rate risk examples →](/product-deep-dive/interest-rate-risk-examples.md) 3. **Execution risk.** In a rare, truly unscheduled market freeze, a new loan can't be opened and an existing loan can't be rolled during that window. Existing loans that aren't being rolled are unaffected. If a roll can't execute, the client temporarily pays the custodian's margin interest for those few days until the market reopens. SyntheticFi monitors all three on your behalf, so the client is never managing this alone. ### What's the worst case? Clients sometimes ask. The honest answer: the main risk is a margin call if the market falls sharply. Adjust borrowing amount to leave more cushion. *** [\* Important Disclosures](/disclosures.md) --- # Agent Instructions This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com. ## Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter, and the optional `goal` query parameter: ``` GET https://advisorhub.syntheticfi.com/product-learn-more/whats-the-catch-risks.md?ask=&goal= ``` `ask` is the immediate question: it should be specific, self-contained, and written in natural language. `goal` is optional and describes the broader end goal you are ultimately trying to accomplish on behalf of the user. GitBook uses it to tailor the answer towards what is most useful for that goal. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.