Certificates are structured investment products. By purchasing the certificate, the investor becomes entitled to a monetary or other claim against the issuing bank on the due date depending on the value of a pre-defined underlying product.
Express Plus Certificate
Would you like to gain profit not only when share prices rise but also when they stagnate?
If you believe that the price of the underlying asset (involved in the actual issue) may rise, stagnate (move sideways), or fall only slightly in the near future and you wish to benefit from it, then you should study the certificate product currently offered by UniCredit Bank AG (HypoVereinsbank) as “issuer”.
If you are a Premium Banking customer, request a call, and our Premium Banking advisors will call you and share with you the details at an arranged meeting.
Caterpillar Inc. (US1491231015) underlying; denominated in US1491231015; end of subscription period: 27.11.2019
Information about the benefits and risks of the currently sold certificates and further details can be found in the following documents:
The investment structure:
1.On the initial observation date the closing price (reference price) of the underlying share is registered as the strike price (100% of the reference price). The trigger level (also known as “early redemption level”) is usually 90% of the initial reference price. The barrier level is usually 75% of the initial reference price.
2.During the term of the investment, on pre-defined observation dates the actual underlying price is compared to the relevant trigger level. Two things can happen:
- If the reference price of the underlying is the same or higher than the trigger level, the certificate will be redeemed early (the product terminates) at the pre-defined redemption price (“early redemption amount”) on a pre-defined settlement day (“early payment date”). This will result in positive investment performance.
- If the closing underlying price is below the trigger level, the certificate will remain in the investor’s portfolio at least until the next observation date.
The actual reference price and the trigger level are compared on each observation date. If no early redemption takes place after any observation date, the final redemption amount shall be established as follows:
- If on the final observation date the reference price of the underlying is the same or higher than the barrier level, the redemption will take place at the pre-defined redemption amount (“maximum amount”), with positive performance.
- However, if the price is below the barrier level, the redemption will take place on the basis of the actual performance of the underlying (the reference price effective on the final observation date divided by the strike price). This will result in a loss for the investor.
Please note that investors will incur a loss if no early redemption event occurs and the underlying price falls below the barrier level on the last observation date!
- If the markets develop favourably, the investment may be redeemed before the expiry of the term on pre-defined early payment days, according to pre-defined rules. The amount credited varies according to the length of the time that has passed.
- There is a barrier level in the investment that protects the investor when the underlying price registered on the final observation date drops typically by no more than 25%.
- Under normal market conditions the certificate can be sold in OTC trade.
- The underlying prices affect the value of the certificate during its term and at maturity. If there is no early redemption and the reference price of the underlying closes below the barrier level on the final observation date, then the payment is made in the amount of the nominal value divided by the underlying price fluctuation. In that case, the value of the certificate will be lower, than the issue price, which leads to a loss. In an unfavourable case, the total invested capital may be lost.
- The dividend payments of the underlying share are not distributed among the investors of the certificate. The dividend payment reduces the price of the share as underlying asset, which has a negative impact on the price of the certificate and thereby the value of the certificate may drop below the trigger level or barrier level.
- During the term, the certificate is also affected by market conditions (e.g. underlying price fluctuation, volatility, expected dividend, interest rates, difference between the underlying price and trigger level and barrier level, remaining tenor, issuer’s credit risk). Capital and yield loss is possible. The value of the certificate does not follow the redemption rules between the observation dates.
- The insolvency of the issuer may be a risk for the investors, as it may mean that the issuer is unable to make payments and thereby the investors may sustain a loss even up to the total amount of their capital, irrespective of the performance of the underlying asset. The certificate is not covered by deposit insurance.
- The performance of the certificate is not necessarily consistent with, and may even significantly differ from, the performance of the share as underlying asset during the term and the certificate can also react more strongly or weakly to any change in the share prices.
- Sale of the certificate prior to maturity may result in a loss.
- The maximum amount of redemption is limited to the pre-defined redemption amounts. The certificate may be redeemed early, in which case the redemption amount is lower than the redemption defined for the final payment date.
- The certificate generally may be sold in OTC trade. The issuer intends to quote purchase price regularly under normal market conditions (Bid). The issuer determines the purchase price by using pricing models available in business and by taking into account the conditions that determine the market. Contrary to the stock exchange (e.g. stock exchange price of shares) the price quoted in this manner does not reflect demand and supply. Under exceptional market conditions or when technical errors prevail, the sale of the certificate may be delayed or may fail.
This information is not comprehensive and cannot be considered as an offer, investment advice or investment recommendation. The distributor of the product is UniCredit Bank Hungary Zrt. (Activity Licence No.: I-1523/2003.), a member of the Budapest Stock Exchange. Pursuant to Act CXX of 2001 on the capital market, this information constitutes commercial communication, while based on Act CXXXVIII of 2007 on investment firms and commodity dealers and on the regulations governing their activities, it constitutes a marketing announcement. Before making your investment decision, please consider the subject, risk and fees of the investment along with any losses and damages that may result from the investments. Please study carefully the effective Fund Prospectus of the product, the Key Information Document (KID) and the currently effective terms and conditions and business regulations of the Bank pertaining to the distribution of the product as well as the terms and conditions also including the order fees. All listed documents are available at the distribution sites and on the Bank’s website, while the KID is available on the issuer’s website.