The EuroStoxx50 (ISIN: EU0009658145) contains the 50 most important stocks in the Eurozone and is still one of the most popular underlyings for certificates and bonds. After the index recovered from its March low of 2,300 points to just under 3,400 points by the beginning of June, it began a sideways movement within a range of 3,160 to 3,390 points. When this article was written, the index was at 3,280 points in the middle of the trading range that has existed for months.
With the UBS Express Certificate currently available for subscription with a fixed coupon, investors can generate positive returns in a maximum of three years not only if the index rises, but also if the index continues to move sideways and if the index falls by up to 30 percent.
Maximum of 3 years duration – six-monthly observation dates
The EuroStoxx50 closing price of 10/26/20 is set as the starting value for the certificate. The barrier activated only on the final valuation day, 10/26/23 will be at 70 percent of the starting value. Regardless of the price trend of the index, investors will be credited a fixed interest coupon of 3.15 percent per year (= 1.58 euros per nominal value of 1,000 euros) on the half-yearly intervals (for the first time on May 3, 21).
If the share is quoted at or above the starting value on one of the valuation days set in the half-year interval (for the first time on April 26, 21), the certificate will be repaid early with its issue price of 100 percent and the interest payment of 3.15 percent per year.
If the certificate expires on the last valuation day, then the repayment will be made at 100 percent if the closing price of the EuroStoxx50 index on this day is above the barrier of 70 percent of the starting value. If the index level is below the barrier, the certificate with the negative index development in relation to the starting value is repaid.
The UBS Fixed Coupon Express Certificate on the EuroStoxx50 Index (ISIN: DE000UBS8634), maximum term until November 2nd, 2013, can still be subscribed to until October 26th, 2020 with 100 euros plus 0.25 percent issue surcharge.
Report conclusion: The new fixed coupon express certificate on the EuroStoxx50 index promises an annual gross return of 3.15 percent in a maximum of three years with a decline in the index of up to 30 percent.
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