For investors who want to achieve disproportionately high returns with the help of the stock market with a relatively low risk, there is a large number of suitable investment instruments available. With investment certificates such as discount, bonus or express certificates on solid underlying values, such as the Deutsche Telekom share (ISIN: DE0005557508), investors have been able to improve the performance of their custody accounts for many years – with those from Landesbank Baden -Württemberg offered Performance Deep Express Certificates, in contrast to “normal” Express Certificates, investors can participate fully in the positive performance of the underlying in the event of a favorable price development.
2.1% interest and 30% safety buffer
If the Deutsche Telekom closing price on November 30, 2020 is set as the starting value of the certificate at EUR 15, for example, then a nominal value of EUR 1,000 will refer to 1,000: 15 = 66.66667 T-shares. The repayment level valid on the first valuation day (02/18/22) will be at 100 percent of the starting value. The repayment level is reduced by 5 percent on each of the following valuation days, which are set annually. The barrier activated only on February 19, 27 will be at 70 percent.
If the T-Share is quoted at or above the repayment level on the first valuation day in just under 15 months, the certificate will be repaid at least 102.10 percent of the nominal value or with the actual percentage development of the share price compared to the starting value. For example, if the share price on this day is 10 percent above the starting value, the certificate will be repaid at 110 percent of the nominal value.
Otherwise, the term is extended by at least one year, after which the certificate is redeemed at least 104.20 percent of the nominal value if the share price is above the redemption level reduced to 95 percent. The possible bonus payments increase by 2.10 percent with each year of the term. If the certificate expires on the last valuation day (February 19, 27) due to a lack of early redemption, the certificate will be redeemed at 112.60 percent of the nominal value if the share is then quoted at or above the 70 percent barrier. If the share price is below the barrier, the certificate will be redeemed by delivering 66 T-shares and paying out the euro equivalent of the fractions.
The LBBW-Deutsche Telekom Performance Deep Express Certificate with ISIN: DE000LB2KMY3, maximum term until February 26, 27, can still be subscribed to in denominations of EUR 1,000 at 101 percent until November 30, 2020.
Report conclusion: The Performance Deep Express certificate on Deutsche Telekom shares enables investors to fully participate in any rise in the share price in the event of early redemption. This certificate will ensure positive returns up to a 30 percent decline in the share price.
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