The 6.5% German Protect Reverse Convertible Bond 2 combines twofixed interest payments of 6.5% with a partial safety mechanism for the invested capital down to the barrier the barrier of 59%. The interest amount is paid out annually, regardless of the performance of the three underlying (Deutsche Telekom AG, Munich Re AG and Volkswagen AG pref.).
The share basket of the Protect Reverse Convertible Bond consists of three German blue chips:
- Deutsche Telekom AG is Europe‘s leading telecommunications provider and present in more than 50 countries. The core business is the operation and sale of telecommunication networks and connections.
- Munich Re AG is one of the top providers of reinsurance, primary insurance, and insurance-related risk solutions in the world. Munich Re has a diversified organization structure and offices across more than 50 countries.
- Volkswagen AG develops and produces passenger cars of the brands Audi, Bentley, Bugatti, Lamborghini, Porsche, Seat, Skoda and VW. Volkswagen AG is also the main shareholder of Traton SE, one of the world‘s leading commercial vehicle manufacturers with its brands Scania, MAN and Volkswagen Caminhões e Ônibus.
The certificate is redeemed at 100% of the nominal value at the maturity date (January 2022), provided that the daily closing price of each of the three underlying shares always quotes above the respective barrier of 59% during the observation period (daily observation).
If one of the barriers is touched or undercut by the daily closing price of at least one of the underlying shares and at least one of these shares closes below its strike at the final valuation date, the predefined amount of the worst performing share is delivered (percentage performance from the starting value to the closing price at the final valuation date).
The issue price amounts to 100 % (nominal value EUR 1,000) within the subscription period. Further information as well as the Key Information Document please find on Product Page.
Reverse Convertible Bonds - explained in an easy way
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The Structured Products Team of Raiffeisen Centrobank