New Way to Play FANG Stocks Falls Short for Some Investors

‘Auto-callable’ notes tied to tech stocks are gaining in popularity but aren’t always delivering large payouts

Investors looking to reap the gains of highflying technology stocks while avoiding the risk are finding they can’t do both.

Citigroup Inc., UBS Group AG and Royal Bank of Canada are among the banks that have issued this year more than $1 billion worth of a type of structured notes linked to one or more of the four FANG stocks: Facebook Inc., Amazon.com Inc., Netflix Inc. and Google parent Alphabet Inc. Issuance has more than doubled from a year earlier through mid-July, according to mtn-i, a London-based firm that tracks...