Markets

Lufthansa, K + S, Varta – high fluctuations offer interesting opportunities

Since the beginning of the third quarter in July, the DAX® has fluctuated between 12,000 and 13,300 points. Good company data and the low interest rate policy encourage the bulls to get in and to push the index up whenever price corrections are made. However, the Brexit negotiations, the sometimes high ratings and the uncertainty surrounding the corona virus are curbing any euphoria. However, the supposed lethargy is deceiving to a certain extent. When looking at individual stocks, large fluctuations or even major consolidation phases have been observed in the past few months. Investors for whom direct entry is currently too risky, however, have interesting return opportunities with Bonus Cap Certificates. Here you will find eight Bonus Cap Certificates with a distance to the barrier of more than 25 percent and a term until June next year.

HVB Bonus Cap Certificates are especially suitable for investors who expect a sideways development in a share and cannot rule out certain setbacks and thus an interesting alternative to direct entry into a share. These securities have a barrier and a cap level. If the barrier is neither touched nor undercut during the entire term, holders of the security receive the cap amount – adjusted by the subscription ratio – paid out. If the barrier is touched, however, the investor loses the chance of a bonus. According to the German Derivatives Association, these securities are among the most popular products. When choosing securities, however, it is important not only to look at the achievable bonus return, but also to choose a generous distance from the barrier. The securities selected here have a margin of at least 25 percent from the barrier. However, the built-in cap limits the chance of winning.

Take MTU Aero Engines, for example: The bonus cap certificate on the MTU Aero Engines share is currently quoted at EUR 163.01 and the share at EUR 161.05. The barrier was set at EUR 115.00 when the security was issued. This currently results in a gap to the barrier of 28.6 percent. If the MTU Aero Engines share is always above EUR 115.00 by the final valuation date on June 25, 2021, investors will receive EUR 190.00 per security at the end of the term. It does not matter whether the share is quoted at EUR 120.00, EUR 150 or EUR 200 on the valuation day. In each of these cases there is EUR 190.00. On the other hand, if the barrier is touched or undershot once during the term, the holder of the security receives the calculated closing price of the share at the end of the term – however, the maximum cap amount of EUR 190.00.

Investment opportunities

Bonus cap certificates for speculation on a sideways development of the respective share

Underlying WKN Selling price in EUR Barrier in EUR
Cap (upper rate limit) in EUR
Distance to the barrier in%
Repayment date You can find more bonus cap certificates for the share …
Airbus Group SE HZ3D4J 67.65 50.00 80.00 26.0 06/25/2020 here
Commerzbank AG HZ3D64 4.86 3.00 5.75 33.2 06/25/2020 here
Daimler AG HR1DUT 52.38 36.00 60.00 26.1 06/25/2020 here
Deutsche Lufthansa AG HR22T2 9.56 6.00 12.00 26.6 March 26, 2020 here
K + S AG HR1E4C 6.76 4.25 8.50 33.7 06/25/2020 here
MTU Aero Engines AG HZ3D9Z 163.01 115.00 190.00 28.6 06/25/2020 here
ProSiebenSat.1 Media SE HR1E2M 10.91 8.00 13.00 27.1 06/25/2020 here
Varta AG HR22YP 111.26 80.00 160.00 30.9 06/25/2020 here
Source: HypoVereinsbank onemarkets; Status: October 20, 2020; 11:45 a.m.

You can find information about how bonus cap certificates and numerous other products work here at onemarkets knowledge.

NEW: Cashback trading – when the issuer pays my order fees!

Place the order as usual through your broker or bank. Cashback via the free Cashbuzz app or online via the website activate. Credit of up to 50 euros per trade (for trades from 1,000 euros) up to a maximum of 1,000 euros per month. Further information at: www.onemarkets.de/cashback

Please note the important information and the disclaimer.

This information does not constitute investment advice, but advertising. The public offer is made exclusively on the basis of a securities prospectus approved by the Federal Financial Supervisory Authority (“BaFin”). Approval of the prospectus should not be understood as a recommendation to acquire these UniCredit Bank AG securities. Only the prospectus including any supplements is relevant and the Final Terms. It is recommended that you read these documents carefully before making any investment decision in order to fully understand the potential risks and opportunities when making an investment decision. You are about to acquire a product that is not easy and can be difficult to understand.

How the HVB products work

The article Lufthansa, K + S, Varta – high fluctuations offer interesting opportunities first appeared on onemarkets blog (HypoVereinsbank – UniCredit Bank AG).

Author: Richard Pfadenhauer

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