In the future, hydrogen is expected to make a significant contribution in the course of the energy transition. The areas of its application are very diverse: transportation, power generation, manufacturing, heating of buildings and chemistry are just some of the areas in which hydrogen-based technologies could be increasingly used. The ease in regard of its producibility, storage and transportation, as well as the avoidance of carbon emissions, are compelling arguments for an emerging trend spurring hydrogen as an energy source.
To enable investors to invest in the future topic of hydrogen, Raiffeisen Centrobank issues the Hydrogen Bonus&Growth Certificate. This certificate is the first RCB certificate with the underlying index Solactive® Hydrogen EUR Index 3.5% AR, which includes 30 companies around the world with significant business activities in the hydrogen industry. A specificity of the index is that distributed dividends (after deduction of withholding taxes) are automatically reinvested in the index, but in exchange a constant dividend of 3.5% p.a. is deducted from the index price (daily aliquot), facilitating a better certificate creation. Details on this index as well as the current list of index members can further be found on the website of the index provider Solactive® AG.
With this investment product without capital protection, investors participate at 100% and unlimited in the positive performance of the underlying index at the end of the term. The barrier of 50% of the index starting value (corresponds to a safety buffer of 50% at the issue date) serves as a protective mechanism. Provided that the barrier is never violated during the observation period, the certificate is redeemed at a minimum of 110% of the nominal amount – even if the index performance is negative at the end of the term. The certificate has a term of five years.
At the initial valuation date the closing price of the Solactive® Hydrogen EUR Index 3.5% AR is fixed as starting value and the barrier (50% of the starting value) as well as the bonus level (110% of the starting value) are determined. At the final valuation date the closing price of the index is compared to the starting value and one of the following scenarios applies:
- SCENARIO 1: index performance ≥ +10%
In addition to the nominal value the positive index performance is paid out at the end of the term. This applies in any case – irrespective, if the barrier was violated during the term or not.
- SCENARIO 2: index performance < +10%
In case the iSTOXX® Global Megatrends Select 50 Price EUR index always quoted above the barrier of 50% of the starting value, redemption is effected at 110% of the nominal value. This means: if the index never declined by 50% or more during the term compared to its starting value, investors obtain the nominal value of EUR 1,100 at the maturity date.
Provided, the barrier of 50% of the Solactive® Hydrogen EUR Index 3.5% AR starting value was touched or undercut at least once during the observation period, redemption at the maturity date is effected according to the index performance (percentage change 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 can be found on the product detail page.
Bonus Certificates – simply explained:
For any additional information you may require do not hesitate to contact us on +43 1 515 20-484.
The Team Structured Products of Raiffeisen Centrobank